A UBS research note raised some concerns about Apple's growth rate and a disappointing iPhone 5 launch in Beijing, sending the company's shares tumbling down.

Apple fell sharply to the lowest price in nearly 10 months, after UBS AG analyst Steven Milunovich cut his price estimate from $780 to $700, citing concerns of a slower growth for the iPhone and iPad.

Apple tumbled 3.8 percent to $509.79 in New York, hitting its lowest price since Feb. 17. Moreover, Apple shares have dropped 27 percent since reaching an intraday record high of $705.07 on Sep. 21.

Milunovich also cited some of the firm's Chinese sources, who are reportedly skeptical that the new iPhone 5 will perform as well as the iPhone 4S. The analyst further notes that Apple's new iPad Mini could be biting into the larger iPad's success.

"Our previous growth estimates seem aggressive given the European economy and tougher handset competition," the analyst said in a research note to clients.

While UBS kept its buy rating on the Apple stock, its 12-month price target cut from $780 to $700 falls below Wall Street's consensus forecast. According to forecasts from 48 analysts compiled by Thomson Reuters, Wall Street analysts, on average, have a $754.02 price target on Apple.

The iPhone 5's debut in China also affected the company's shares, as it was "the least eventful launch of an Apple device in the company's four-year history in the Chinese capital," as one report described it.

Moreover, a federal jury in Delaware found that the Cupertino giant infringed three patents belonging to a company partly owned by Nokia Corp. and Sony Corp. of America. Needless to mention, the jury's patent infringement ruling further weighed on Apple's stock.

Milunovich, however, remains optimistic when it comes to Apple's longer-term outlook.

"Although analyst estimates may need to be trimmed, we don't think the story is over," said Milunovich. "Apple is driven to make beautiful products. Whether it is an iTV, wearable computers, or another new product category, we have faith that innovation is not dead."

"The stock has been a tug of war between low valuation and peaking growth and margins. Earnings momentum should turn positive and help the stock in 2013."