New 4-inch iPhone expected to add $5.5 billion in sales for Apple

With an average selling price of $550, analyst Amit Daryanani believes the so-called "iPhone SE" will add $5.5 billion in sales to Apple's bottom line. That would translate to an additional 23 cents in earnings per share, or 2 percent to its fiscal year 2016.

Daryanani believes his estimates are supported by earnings from Apple supplier Dialog Semiconductor, which told investors it expects its revenues to be up in the single digits for the full year. The integrated circuit maker is believed to derive more than 70 percent of its revenues from Apple, and investors look to its performance to gauge potential iPhone sales.

Dialog's guidance for the March quarter was slightly below expectations, which Daryanani said could signal lower-than-expected iPhone sales. However, he also cautioned that Dialog's March quarter could also be affected simply by changes in channel inventory by Apple.

Regardless, Daryanani believes that Dialog's guidance is further evidence that the March quarter will see iPhone sales bottoming out, potentially setting the stage for iPhone sales to return to the upside of investor expectations in June.

Apple is expected to hold an event the week of March 21 to introduce a new, more powerful 4-inch iPhone, as well as a next-generation 9.7-inch iPad. It's believed that both products will launch very soon after they are announced, potentially starting sales before the conclusion of the current March quarter, though the first full quarter of sales would be June.

RBC Capital Markets has maintained an "outperform" rating for shares of AAPL, with a $130 price target.