Competitors have had modest success, Wu noted. "
(GOOG - Get Report)
with its Nexus 7 is having decent success," and may sell mid-millions before year-end.
(AMZN - Get Report)
also refreshed its Kindle tablet line, recently announcing a
7-inch Kindle Fire HD.
One hedge fund analyst, who declined to be named, said that an iPad Mini would hurt Amazon and
Barnes & Noble
(BKS - Get Report)
more than it would help Apple. "It [the iPad Mini] allows them to compete with the Nexus 7 and the Kindle Fire, and the new NOOKs. "This could be a blow to Amazon, and at the same time, take market share from Barnes & Noble."
The iPad has 68% of the tablet market, according to
, and a smaller iPad would allow Apple to continue to grab even more market share as its competitors nip at its heels on the lower end.
Channing Smith, portfolio manager at
Capital Advisors Growth Fund
, said the prospect of an iPad Mini bodes well for Apple in the coming months. "It's a powerful one-two punch with the iPhone 5 and iPad Mini," Smith said over the phone. "It sets them up very well for the holiday season."
A smaller tablet would no doubt be less pricey, and that could help Apple expand its presence beyond its core customers, especially as China continues to play a larger role in the Cupertino, Calif.-based company's future.
In a recent analyst note, Topeka Capital Markets analyst Brian White said an iPad Mini would expand Apple's reach to price-sensitive customers and that some customers would likely enjoy the convenience of a smaller, lighter tablet. White also feels the education market would be "well-suited" for a smaller iPad.
While it's uncertain about when the iPad Mini is coming at this point, one thing is very clear: When it does come, it's going to drive sales. That should be music to shareholders' ears.
Interested in more on Apple? See TheStreet Ratings' report card for
Written by Chris Ciaccia in New York