Wall Street analysts are retracting their bullish calls for Apple because of slowing iPhone sales.

Apple reported weaker-than-expected December-quarter iPhone unit sales on Thursday. The company also gave a lower-than-expected revenue forecast for the March quarter. The company's shares declined 4.4 percent Friday.

KeyBanc Capital Markets on Thursday lowered its rating for Apple shares to sector weight from overweight.

"Soft iPhone sell-through suggests a saturated market and the lack of gross margin upside reduces our view of potential profit growth," analyst Andy Hargreaves wrote in a note to clients. "This reduces our view of potential upside in the stock and prompts the downgrade."

Hargreaves does not have an official price target for Apple shares, but he said the stock's "fair value" is $178 per share.

In similar fashion, Bernstein reduced its rating for Apple shares to market perform from outperform.