Waxing Poetic on Apple

The upward movement follows several weeks of mostly sideways trading in Apple's shares. Although they jumped immediately after the company's earnings report last month, they had mostly traded between $41 and $43 a share since.

Although the company is in the midst of turning to Intel (INTC Quote)-based processors, Stahlman predicted that the updated computers will all include PowerPC-based chips, the company's current standard.

IBM (IBM Quote) recently came out with a low-power version of its G5 PowerPC chip and some analysts have speculated Apple would use the processor to finally deliver a long-awaited G5 laptop. However, that chip is more suited for a desktop machine than a laptop, Stahlman said, predicting that Apple will incorporate it into its low-end Mac mini.

Although Apple will upgrade its PowerBook laptop line, it likely will do so with a Freescale Semiconductor (FSL Quote) G4 chip rather than the new G5 processor, he said.

"These new models are likely to support further expansion of the high value-added Mac franchise," Stahlman said.

Additionally, the company is likely to soon upgrade the screens on its PowerBooks so that they can display high-definition video, Stahlman said. Further, he predicted the company would soon unveil the so-called video iPod, the long-rumored successor to the company's wildly popular digital music players that will be able to play movies.

Apple is likely to roll out the new computers and products at its 2005 Expo in Paris next month, if not sooner, he said.

For his part, Munster predicted that Apple will introduce a new, potentially higher capacity version of its low-end iPod shuffle and a color-screen version of its midrange iPod mini. While not predicting any new Mac models, Munster said the company's computer line has increased its market share in the last three quarters and would likely continue doing so.

"Results over the last 3 quarters have illustrated the existence of the 'halo' effect, and we expect to see continued evidence of iPod-to-Mac carryover in the September quarter due to back-to-school," he said. "We believe minimal upside to current Mac market share estimates would have a significant impact on Apple's overall numbers."