Sacconaghi, the top-ranked computer analyst according to Institutional Investor magazine, boosted his stock-price estimate from $135 to $175 and increased his forecast for 2008 cash earnings per share by 3.3 percent to $5; however, the firm kept the "market-perform" rating. Last quarter, Apple said it plans to amortize revenue from sale of both the iPhone and Apple TV over 24-months, as it continued to fund software development and roll-out updates to customers during that time period. Analysts also predict that Apple has negotiated for a portion of its monthly subscriber revenues with its exclusive contract with AT&T and will likely have the same arrangement with other partners. In September, Apple announced plans to bring the iPhone to several European countries through an exclusive distribution rights with different carries in the UK, Germany, and France. The company sold the right to distribute its four-in-one deice to Telefonica SA's O2 in the UK, Deutsche Telekom AG in Germany, and France Telecom SA's Orange. "On the positive side, if Apple is able to secure what we believe are significant, near-100 percent margin payments from non U.S. wireless carriers that approach those we estimate from AT&T, and drive material unit volume of phones, there could be material upside to our earnings estimates and to the stock price," Sacconaghi wrote in his note obtained by Bloomberg. The analyst, however, said that Apple would be unlikely to sustain the same level of profitably if it expects to sell 10 million phones in 2008, as its CEO Steve Jobs had hoped. Sacconaghi noted that carrier payments to the company could allow it "to pull some strategic strings" to drive up unit sales, but only at the expense of profitability. Apple could earn about $14 from AT&T per month per subscriber, nearly double what rival Research in Motion -- creators of the Blackberry -- already receives from its carrier partners. In addition to its point-of-sale profit on the device, Apple could earn more than $330 per subscriber over two years in the US and could earn as much as $500 with its exclusive UK partner O2, the firm estimated. "The iPhone's substantial revenue share potentially allows Apple to price the iPhone very aggressively - perhaps even selling the device at a loss - to stimulate sales," the analyst wrote in his note. "However, this comes at the expense of profitability, and unless the demand elasticity was high, our analysis indicates that it would be difficult for Apple to significantly move the needle on earnings."