"We continue to believe that some Street estimates for iPod unit shipments for the December quarter are too high," said Munster, whose firm has not recently done investment banking for Apple. "We do not expect Apple will be able to ship the number of units that are already anticipated in some Street models."
Still, Munster found other reasons to be bullish on Apple. Demand should remain strong for both iPod products and the company's Macintosh computers, he said. Indeed, Apple's upcoming switch to processors made by Intel (INTC - Get Report) should spur a wide range of updates to the company's computer lineup, he said. In the past, such updates have led to increased sales.
Munster, too, raised his price target on Apple, going to $79 a share from $68. At that higher price, Apple's valuation would be 45 times its expected earnings over the next year, which is in line with its three-year average, he said.
"Apple's domination in digital music is a critical piece to the story, but we do not believe iPod is the only growth avenue for the company. Indirectly, we expect iPod to continue to be a foundation for growth in other parts of Apple's business," Munster said.