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Monday, January 08, 2007, 10:00 am PT (01:00 pm ET)

Macworld: Apple ordering "key components" for new video iPod

Shares of Apple Computer inched up by a percent on Monday after an analyst for JPMorgan raised estimates for the company's December quarter and said checks indicate a new hard disk drive-based iPod may be near.

In a research note to clients on Monday, analyst Bill Shope said product introductions during Tuesday's Macworld Expo are likely to focus on iTV and Mac OS X 10.5 Leopard.

"The iTV device, and the widescreen iPod, will serve as the hardware component in Apple’s downloadable movie business model," he wrote. "Leopard will integrate the company’s Boot Camp software as a utility, which we continue to believe represents a critical positive catalyst for the Apple story."

Shope said he's recently gathered data points suggesting that Apple has been ordering key components for a new HDD-based iPod. "This leads us to believe that Apple may finally launch the video-centric iPod, which will fit nicely with its iTV launch, and further solidify the company’s early lead in the paid movie download market," he wrote.

On the other hand, the analyst said checks with sources in Asia suggest the iPhone may not be ready until at least the end of this quarter. He acknowledged that an iPhone no-show "may be a modest disappointment for the stock."

Meanwhile, Shope raised his estimates slightly for Apple's recently-ended December quarter, primarily due to greater than expected sell through of its new iPod shuffle digital music player.

"We now expect December quarter iPod shipments of 16 million up from 14.8 million," he wrote. "Our forecast now calls for revenues of $6.61 billion and earnings-per-share of $0.82 versus $6.57 billion and $0.81 previously." His forecast for the quarter also includes sales of 1.9 million Macs.

The analyst reiterated his Overweight rating on shares of Apple.