NEW YORK (TheStreet) -- Apple (AAPL) - Get Report has locked up a big part of the world's sapphire production capacity. Apple customers have a special appreciation for a finely crafted instrument. This will be big. Very big.

If Apple produces a new iPhone 6 with a 4.7-inch sapphire display, and most believe the company will, it will be a double win for Apple's competitive prospects. First, because we do so much more with our smartphones than just a few years ago, a larger display is something iPhone customers have been hungry for.

Second, that larger screen composed of sapphire will create a sensation of value and tactile appreciation all out of proportion to a comparable phone with Gorilla Glass. It will be a true "whole is more than the sum of the parts" effect.

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Unfortunately, many see sapphire as simply a more scratch-resistant display and wonder how wise Apple is to replace a $3 piece of Gorilla Glass with a $30 piece of sapphire. Seen in the abstract, from a distance, it doesn't seem to make a lot of sense.

That is, I predict, until one holds the iPhone 6 in the hand and sees and feels the craftsmanship of this spectacular mineral, a chunk of aluminum-oxide. In fact, one can think of it as transparent aluminum but with a hardness second only to diamond.

The Jewelry Effect

People like to feel distinctive. Apple appeals to customers who appreciate a touch of class. Some Apple critics may be uncomfortable with that feeling, but it's how Apple has accumulated $167 billion in total cash and investments.

The reality is that Apple has a long history of excellence in industrial design. Jonathan Ive has made a career out of making things that just feel right in the hand. That story is well told by Leander Kahney in his book Jony Ive.

One shouldn't underestimate how dedicated Apple is to differentiating itself from Samsung (SSNLF) . Apple has tried, in the courts, to preserve its pioneering innovation with the iPhone, but it turns out to be reasonably easy in 2014 to build a smartphone with a touch screen and little icons, and then maneuver in the courts.

While Apple has had some success in lawsuits against Samsung, the real way to innovate is to put something into people's hands that ups the ante, that thrills them and which cannot be easily or inexpensively duplicated by the competition. With a sapphire display and a huge investment in manufacturing technology, Apple looks to have achieved that.

In fact, Apple appears so confident that the Wall Street Journal recently reported Apple has put in an order for between 70 and 80 million next-generation iPhones. That's a lot of confidence and probably reflects the fact that Apple executives have likely already handled one, Apple very much understands its customers and this is a product that is expected to be highly prized, like jewelry, and hard to mimic.

So 80 million iPhones will generate approximately 45 billion dollars in revenue for Apple. The company may not be able to make enough of them.

As this awareness surfaces, AAPL is not going to remain below $100 for much longer.

At the time of publication the author had no position in any of the stocks mentioned.

Follow @jmartellaro

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

TheStreet Ratings team rates APPLE INC as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:

"We rate APPLE INC (AAPL) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, expanding profit margins and good cash flow from operations. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • AAPL's revenue growth has slightly outpaced the industry average of 2.1%. Since the same quarter one year prior, revenues slightly increased by 4.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Although AAPL's debt-to-equity ratio of 0.14 is very low, it is currently higher than that of the industry average. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.32, which illustrates the ability to avoid short-term cash problems.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. When compared to other companies in the Computers & Peripherals industry and the overall market, APPLE INC's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
  • 43.45% is the gross profit margin for APPLE INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 22.39% is above that of the industry average.
  • Net operating cash flow has slightly increased to $13,538.00 million or 8.26% when compared to the same quarter last year. In addition, APPLE INC has also modestly surpassed the industry average cash flow growth rate of 5.16%.