Market share of the iPod from

Apple

(AAPL) - Get Report

is rising again after estimated declines from 2006 to 2009 because of the weak macro environment, partial cannibalization from the iPhone and increasing competition from other media players like

Microsoft

's

(MSFT) - Get Report

Zune and

SanDisk

's

(SNDK)

Sansa.

We see iPods continuing to gain market share due to newer versions being released and the integrated appeal of Apple products, such as media content being integrated among iTunes, iPads, iPhones and computers with the Apple's operating system.

While iPods constitute a small portion of Apple's stock value at almost 3% by our estimates, we view the iPod as a core component within the suite of Apple's mobile products and maintain a bullish outlook for the group as a whole.

We currently have a Trefis price estimate of $418 for Apple's stock, versus the current market price of close to $300.

The iPod's market share rebounded from 2009 to 2010 due to the launch of newer versions of the Shuffle, Touch and video-enabled Nano. Moreover, expanded content such as music videos and TV shows on iTunes also broadened the appeal.

As the market grows so does competition and we see this as the primary threat to the iPod family. Creative and SanDisk have competitive media players at lower price points that can play content from any source rather than being captive to Apple's iTunes interface.

Also given the success of Apple's iTunes platform and its ability to stimulate demand for multiple Apple devices, several companies are launching their own platforms to sell media, apps and content including

Google

's

(GOOG) - Get Report

Android App Market,

Nokia

's

(NOK) - Get Report

Ovi and Samsung's Bada.

In the near term we do not see these competitors as a threat to Apple's iPod family and believe the touch-enabled Nano demonstrates Apple's continued ability to innovate in a seemingly crowded market.

The average Trefis member forecast shows a more optimistic case than our baseline assumptions predicting that the iPod market share will increase from 24% in 2010 to 30% by 2016, compared to our estimates showing a market share stabilizing around 25%. Higher market share adds slightly to our price estimate.

You can drag the forecast trend line above to express your own view.

Our complete analysis for Apple's stock is

here

.

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