Analysts and investors alike applauded the long-rumored arrival of the Apple ( AAPL) iPhone at Tuesday's Macworld in San Francisco, where CEO Steve Jobs showed off his company's continued knack for user-friendly design and forward-thinking products.

The newest device has been a boon for the stock. Apple shares soared to close higher than 8% over the previous day, and were nearing the $100 mark Wednesday after posting a new 52-week high of $97.80.

The stock was recently trading at $96.24 in more than double the usual volume.

Launching in June, the iPhone's 4-gigabyte model will sell for $500 and the 8-GB model for $600, both with a two-year contract from Cingular, the company's exclusive telecom partner for the device, which entered into the contract before even seeing the actual phone.

"The phone was far more impressive than we imagined it would be, and it appears to be worth the wait," JP Morgan analyst Bill Shope wrote in a Wednesday note. "We believe yesterday's introduction marks a significant rebound in product innovation for Apple and extends the company's powerful consumer franchise."

Slimmer than any smartphones sold to date, according to Jobs, the iPhone substitutes a 3.5-inch screen with a touchscreen in place of a QWERTY keyboard and multiple buttons.

Users tap the screen to retrieve and view videos, photos and Web pages, listen to music or make phone calls. It runs the Mac OS and Safari browser, and synchs with iTunes.

The interface, software and Net connectivity will give the handset industry "a quick wake-up call in coming months," Shope wrote.

He raised his fiscal 2008 estimates to $35.42 billion in sales and an EPS of $3.73, jumping from $28.13 billion in sales and $3.28 a share previously. Shope has a buy rating on the stock. His firm makes a market in Apple and has provided noninvestment banking services to the company.

"We think that Apple has delivered yet another innovative product, exceeding most expectations," Prudential Equity's Jesse Tortora wrote in a note to investors. The design "is elegant and the device appears to continue Apple's traditional strengths of an intuitive interface and seamless software integration," Tortora wrote.

Tortora, whose firm owns shares of Apple and makes a market in the company, upped his price target to $90, maintaining his neutral rating, and raised his 2008 earnings estimates by 14 cents to $3.35.

Yet he was unsure how users will react to typing on a screen vs. small plastic buttons (as on Research In Motion's ( RIMM) BlackBerry or other smartphones), and the rich price.

Though the device will cost more than he expected, he noted that Cingular may offer rebates to lower it a little. He also expects Apple to introduce scaled-back phones at lower price points to attract mass-market adoption.

Cannibalization of iPod sales doesn't seem to be a chief Wall Street concern.

Standard & Poor equity analyst Richard Stice says that even if the number of iPods sold is sliced in half, the iPhone launch "would still be accretive to earnings because you're getting a higher price point."

Jobs said Tuesday that Apple aims to sell 10 million handsets in 2008 -- its first full year of iPhone sales -- which would be 1% of the mobile phone market worldwide.

"We think that (Jobs' estimate) is reasonable but somewhat conservative," Stice says. "We think they could potentially do better than that."

Stice has a strong buy rating on the stock. He does not own shares, and his firm does not do investment banking.

Still, at least one analyst was concerned that the cost may prevent widespread interest in the iPhone.

To reach the 10 million-handset mark, Apple will have to convince "consumers to spend dramatically more on an enhanced handheld computing experience. We do not think this is a slam-dunk," Bernstein Research's Toni Sacconaghi wrote Wednesday.

He noted that there is a "tiny" market for phones and smartphones selling above $300.

"Apple's phones will not only be priced at $499 and $599, but appear to require an unlimited data plan, meaning that service will cost $80 plus per month (and $2,500 for two years!)" he wrote.

Bernstein, who makes a market in Apple and whose firm or its affiliates have investment discretion for more than 1% of outstanding Apple stock, added that the device will have "negligible" adoption by businesses.

Because of the fervor around the device, Stice says he wouldn't be surprised to see a Sony ( SNE) PlayStation 3-type line snaking around Cingular and Apple stores when the iPhone hits shelves this summer.

The iPhone will launch in Europe in the fourth calendar quarter of this year, and in Asia in 2008, Jobs said Tuesday.

Apple reports its first quarter results on Jan. 17.

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