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iPad, Mac, iPhone growth potential seen to propel Apple stock to $375

A prominent Wall Street analyst has upped his price target for Apple stock from $280 to $375, citing stronger than expected iPad, iPhone and Mac sales, and the fact that the company remains "a small fish in three very large ponds."

On Monday, Charlie Wolf with Needham & Company issued his first valuation report on Apple since February. He upped his price target to $375, saying that the trajectory of iPad and Mac sales was "materially higher" than he forecast earlier in the year. In addition, iPhone owners appear to be upgrading faster than he had assumed.

In February, Wolf forecast that Apple would sell just 2 million iPads in 2010, and 6 million in 2011. In reality, Apple managed to sell its first 2 million iPads in under 2 months.

Now, he conceded, Apple is on track to sell more than 12 million annually before the international rollout of the iPad is even completed.

Mac sales are strong, too, on pace for 14 million in calendar 2010 — a number more than 50 percent higher than what he had previously forecast for the year. And iPhone sales are strong as well, with Apple's struggles to meet iPhone 4 demand suggesting that customers are upgrading faster than Wolf's analysis had assumed.

And even with all of this growth, Apple still has the potential to continue moving upward, because the iPod is its only major product that truly dominates its market.

"Apple is a small fish in three very large ponds," Wolf wrote. "The company holds just a 4+% share of the personal computer market. The combined iPhone and iPod halo effects, not to mention the emerging iPad halo effect, should enable the Mac to continue to gain share in the worldwide home PC market. "The iPhone is also a small player in the smartphone market with just a 14% worldwide market share."

He continued: "Finally, while the iPad currently has the tablet market to itself, the early evidence suggests that the device is beginning to capture share from the netbook market and is invading the business market at a rate unprecedented for an Apple product."