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Wednesday, August 25, 2010, 01:00 pm PT (04:00 pm ET)

Piper: Sept. iPod, iTV announcements likely to boost Apple shares

With Apple's annual media-centric keynote now set for Sept. 1, Piper Jaffray has advised investors to buy shares of AAPL prior to the event, citing past stock boosts after new iPods were unveiled.

Analyst Gene Munster said Wednesday that since 2005 Apple has hosted an event in early September every year, and shares of AAPL stock for the month have increased an average of 12 percent over that span, excluding 2008 when the market saw widespread declines. When measuring through the end of the year, shares went even higher, by an average of 22 percent.

"We believe Apple will hold a similar event this year to announce the first iPod touch with a camera, an updated Apple TV with an App Store, and iTunes changes, like a cloud-based iTunes service," he said in a note Wednesday, issued just before Apple officially announced its Sept. 1 keynote. He had recommended that investors buy AAPL stock before the announcement was made. "We would view an updated Apple TV as an important step in Apple developing an all-in-one Apple Television. An updated MacBook Air, in our opinion, is a wildcard possibility."

Munster said he believes a new Apple TV could turn the company's "hobby" into a more material business, selling millions of units per year. The current Apple TV, he said, likely sells less than a million a year.

"Bringing the App Store to the Apple TV would add many new and meaningful features (like Netflix streaming, or video games, for example)," Munster said. "Other mediar eports have indicated that Apple could offer TV show rentals for $0.99 on the iTunes store, which we would view as a step forward for Apple TV."

Munster continues to believe that a connected HDTV is in the works from Apple, likely to arrive in the next 2 to 4 years. The rumored iTV product, he said, would just be a stepping stone to an eventual flat-panel living room TV.

Piper


The analyst said it's also possible that Apple could announce a new cloud-based iTunes service could be introduced at the Sept. 1 event. A crucial part of that service, Munster believes, will be the soon-to-open data center Apple is building in North Carolina.

Coupled with an expected iPod touch update with a forward-facing camera for FaceTime video chat, Munster sees the potential for a significant increase in AAPL stock.

"We believe that investors generally anticipate the Sept. event by the beginning of the month, and anticipation builds ahead of the holiday shopping season with Apple's iPod lineup (along with Macs and other products) set for holiday sales," he said. "However, keep in mind that historical trends are not necessarily an indicator of future events."