Apple Inc.’s (Nasdaq: AAPL) shares rose to an intraday record after a research report from Jefferies & Co. said the company had started production of the iPad mini, a smaller version of its popular iPad tablet.

Already the world’s most valuable company, Apple Inc. saw its stock hit $644.13 in morning trading, before retreating to $642.80. That was up $6.46, or 1 percent, from Thursday’s close.

The rally continued Friday afternoon, sending shares to $648.11, up 1.85 percent or $11.77, at the close.

Shares rose higher still after hours by another 74 cents.

The previous high for the stock was $644, hit on April 10.

With tablet sales predicted by research firm Yankee Group to overtake those of personal computers by 2015, Apple is preparing for challengers for its iPad. Microsoft Corp. (Nasdaq: MSFT) later this year will begin selling its Surface tablet, while Google Inc. (Nasdaq: GOOG)  introduced its Nexus 7 device in June. debuted its Kindle Fire tablet last year.

“We believe Hon Hai is the main manufacturer for the iPad mini,” Peter Misek, an analyst at Jefferies in New York who recommends buying Apple, said in the report Friday. Hon Hai Precision Industry Co., maker of iPads for Apple, had revenue increase 5 percent in July from the previous month, while sales are typically little changed at this time of year, he said.

Misek raised his price target on the stock to $900 from $800. His belief about the mini is based on readings of reports from Apple’s suppliers, contract manufacturers and contacts in the region. He now believes Apple will build 25 million iPads of all kinds in the current quarter, up from a previous estimate of 16 million, which did not include the “mini.”

Apple plans to debut a smaller, cheaper iPad by the end of this year, people familiar with the plans said in July.

Apple’s shipments of iPads surged 44 percent to 17 million in the second quarter, giving the company its biggest share of the market in more than a year as devices from competitors lost ground, according to a report this month from IHS.

The Cupertino, California-based company may have also started production of a television product, Misek said, citing recent data from Sharp Corp., Hon Hai and “other specialty chemical and TV component suppliers.”

Apple is in talks with at least one of the largest U.S. cable companies about teaming up on a product to carry live television and other content, a person with knowledge of the plans said yesterday.

Apple has a market value of $602 billion, almost 50 percent higher than No. 2 Exxon Mobil Corp. at $408 billion.

Apple’s stock fell last month after the company’s earnings report for the April-June quarter showed the slowest growth in more than two years. It was only the second time in 10 years that Apple had missed analyst expectations.

(Bloomberg and The AP contributed to this report.)