What are Equity Analysts Saying About iPhone 5?

Apple (NASDAQ:AAPL) analysts love the iPhone 5. On Friday, Deutsche Bank’s Chris Whitmore raised his price target on Apple stock to $850 on expectations that “the iPhone 5 will fly” because there was a “large, captive audience for upgrades.”

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Whitmore said his prior estimates for sales of the new smartphone were too conservative and added that he was extremely impressed by Apple’s plans for a rapid international launch. He estimated Apple may have sold 5 million to 6 million iPhone 5 units in the first weekend alone, and raised his estimates for the current year to 138 million from a previous projection of 133 million. For calendar year 2013, he has even higher hopes, expecting unit sales of 180 million.

“We believe demand for the iPhone 5 is extremely robust and will prove more durable than the iPhone 4S cycle due to its substantial feature set upgrade,” the analyst wrote in a note to investors. “With a fast geographic ramp … we expect supply to be the gating factor to near-term unit shipments; not demand.”

Among factors in favor of the iPhone 5, according to Whitmore, are Apple’s rich application offerings and third-party ecosystem, the idea that Google’s (NASDAQ:GOOG) Android may get more expensive or lose features as a result of litigation, an expanded geographic reach, and meaningful iPhone 4 and iPhone 3GS installed base upgrade potential.

He said the iPhone may make up about 20 percent of total annual smartphone sales share, but added that even that estimate could eventually prove conservative because Apple had “ample room for additional share gains going forward.” If supply constraints reportedly being experienced by Apple extend into the December quarter and the holiday shopping season, Whitmore said iPhone 5 sales would be deferred to the first half of next year and give the device a more sustained cycle.

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