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SAN DIEGO, CALIF. (TheStreet) -- Apple's (AAPL) itsy-bitsy iPad mini is past its prime, having gone from ripe to rotten in the sales department at the hands of an unlikely source: the company's own iPhone 6 Plus.

The super-sized smartphone will cannibalize sales from the compact tablet in 2015, as Apple customers opt for a "one-device-fits-all proposition," Trefis analysts wrote in a Friday note on the Cupertino, Calif.-based company. But Apple will still come out on top. "The thicker margins on the new iPhone 6 Plus models should more than make up for potentially lost sales of the iPad Mini," Trefis concluded.

Apple's tablet category has been in decline in recent quarters. In the September quarter, Apple sold 12.3 million iPads for $5.3 billion in revenue, which was 10% less than in the previous quarter and down 14% year over year. Unit sales were down 7% sequentially and 13% from the year-ago quarter.

"We believe that iPad sales could come under further pressure going into 2015, with the introduction of Apple's first phablet device, the iPhone 6 Plus, which is likely to cannibalize sales of Apple's popular iPad Mini models," Trefis said.

The larger iPhones won't help Apple's iPad problem, but they should give Wall Street something better to fixate on. Trefis holds a $120 price target for Apple, representing around a 10% premium over the current share price. Shares of Apple closed down nearly 1% at $109.33 on the first trading day of the new year.

"We believe the most popular version of the iPhone 6 Plus is likely to be the 64 GB version, which retails at $849 off contract," Trefis analysts wrote in the research note.

At that price, Trefis estimates that Apple makes a gross profit of more than $600 per phone. Margins on the iPad mini, meanwhile, are likely closer to $100 per tablet, according to Trefis.

The Trefis conclusion echoes those made by Citi Research analyst Jim Suva, who said at the beginning of December that the iPhone 6 and 6 Plus devices will ultimately help Apple boost revenue and profits by improving margins. Consumers, Suva believes, are opting for the priciest iPhone models because they want the extra storage.

Apple may have another dud on its hands besides its slumping iPad. Venture capitalist Fred Wilson predicts that the much-hyped Apple Watch will be a disappointment because wearables aren't for everyone. Argus Research analyst Jim Kelleher hasn't jumped on the Apple Watch bandwagon either, but he did raise his price target from $120 to $125 per share on Friday because he anticipates stellar sales of the iPhone 6 and iPhone 6 Plus this year. Apple announced the smartwatch in October 2014, but hasn't provided a release date more specific than "early 2015."

--Written by Jennifer Van Grove in San Diego, Calif.

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