Turning to the possible iTV, Huberty is modeling for an extra $17 billion in annual revenue based on a more conservative 10% attach rate among iTunes account holders. That figure is based solely on a U.S. rollout of an Apple smart TV, which could translate into additional earnings per share of $4.50 for the year based on an average selling price of $1,300. As the iTV rolls out to the rest of the world, the business could generate up to $68 billion in sales and tack on $18 per share in annual earnings.
When you combine those two new potential product categories, we’re talking about incremental revenue opportunities of $78 billion to $83 billion after everything is said and done.
This is all before we even consider other possible catalysts for Apple, such as upcoming product refreshes, expanded iPhone distribution with larger carrier partnerships such as China Mobile Ltd. (NYSE:CHL) , or the possibility that the company is preparing to boost its dividend and give more cash back to shareholders.
Huberty assigns bull case, base case, and bear case price targets of $980, $630, and $400, respectively, over the next year. Seem like a pretty favorable risk/return ratio, if you ask me.
Besides, who would say no to a free option?
The article 2 Ways Apple Investors Are Freerolling originally appeared on Fool.com and is written by Evan Niu, CFA.
Fool contributor Evan Niu, CFA, owns shares of Apple. The Motley Fool recommends Apple and Google and owns shares of Apple, China Mobile, and Google.
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