Gene Munster, analyst for Piper Jaffray, has raised his predictions for Apple stock in the next twelve months. Earlier this year Jaffery predicted that the stock could easily hit $718 per share, but this morning he announced that Piper Jaffray sees Apple breaking $1,000 per share in the next year.

On the back of strong iPhone sales and an average consumer upgrade path of 21 months, Munster believes that  a whopping 85 percent of current iPhone users plan on upgrading to the next iPhone when it’s released. “If we assume an average iPhone life of 21 months, and 85% of users upgrade to a new iPhone, that implies 45% of iPhones through 2015 are ‘in the bag,” he said. “We believe demand remains strong for the iPhone 4S based on global store checks and momentum from the 3rd-gen iPad launch.”

In short, Munster and Piper Jaffery believe that Apple is set to almost double its market capitalization from $576.79 billion to a whopping $1 trillion by 2014. But where is that extra value coming from?

Gene Munster, speaking on behalf of Piper Jaffery:

[quote]the companies we consider to be the 10 most relevant competitors to Apple (Samsung, HTC, RIMM, NOK, SNE, DELL, HP, MSFT, INTC, GOOG) represent nearly $1 trillion in market cap today. We believe 20% of that value, or ~$200 billion could shift to Apple through 2014. Thus there is potential for Apple to repeat history and add another $400 billion to its market cap. At a $1,000 share price (roughly $1 trillion in market cap) Apple would represent 26% of the total US tech market cap from 17% today.[/quote]

These forecasts come on the heels of AAPL shares breaking previous records last week, reaching over $614.21 per share. Additionally, Katy Huberty, from Morgan Stanley, estimated that Apple stock could reach $720.00 by the end of the year, with a “bull case” scenario seeing the stock hit $960.00 per share in the next twelve months.

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