Based largely on iPad, iPhone 4

JP Morgan analyst Mark Moskowitz has raised the firm's price target for Apple stock 24 percent, from $316 to $390. The figure is said to represent a new Wall Street record, and be based largely on just two Apple handhelds. "The rapid growth phenomena of both the iPhone 4 and iPad stand to intensify in coming quarters," Moskowitz writes in a memo, adding that the iPhone 4 in particular appears to have "insatiable" early demand.

Addressing the device's reception problems, the analyst says JP Morgan is "not concerned," as it expects the issue to be resolved with "hardware or polymer modifications." Wording from Apple has typically been thought to be pointing to a software fix, not physical repairs. Interest in the iPad, meanwhile, is expected to accelerate going into the back-to-school and holiday shopping seasons.

Also helping Apple profits may be lower component prices in the next few quarters, combined with better manufacturing yields. Moskowitz comments that he has not factored in the potential of the iAd network, which launches today, or rumored plans for a Verizon iPhone. Like others, he suggests that a Verizon model will not arrive before next year.

The prospect of multiple government investigations into Apple abuses is dismissed. "The recent overhang related to Apple's market capitalization being too big and it attracting the regulators is overdone. Indeed, we think that it is a frivolous topic," says Moskowitz. "We do not expect the government to penalize a pioneer of enhanced user experiences."

by MacNN Staff