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Apple is manufacturing a growth spurt that could send its shares more than 20% higher to $600 over the next year.

Apple (ticker: AAPL) said Monday that it sold nine million of its new iPhone 5S and 5C devices during the first three days they were available, versus five million for last year's iPhone 5. (See Tech Trader Daily.) That's partly explained by this year's broader launch; China got phones on the same day as the U.S. Then again, pricier 5S phones are in short supply, suggesting Apple could have sold even more of them.

Shares of Apple rose 5% Monday to $490 and change. They're up 12%, compared with a 1% rise for the Standard & Poor's 500, since this column argued in July that Apple is priced for handsome returns even without a return to strong growth (see "Apple Should Shine Brighter"). Yet they still sell for just 12 times forward earnings estimates, a discount of about 20% to the S&P 500. Four events could send them well higher over the next year.

First, the strong initial iPhone sales, combined with a backlog of orders for the higher-priced model, suggest Apple will report solid revenues in both its current quarter, which runs through September, and the following one. Profits should please Wall Street, too. Even the lower-price phone carries gross margins that are higher than those for Apple overall. Earnings estimates for the company have been rising in recent days, and could climb further as analysts gradually revisit projections and publish fresh numbers.

Second, Apple has yet to announce a deal that is expected to begin offering the iPhone through China Mobile, that country's largest wireless carrier. But it's close, according to reports by the Wall Street Journal and others. China Mobile has more than 750 million subscribers, compared with 100 million for Verizon Wireless.

Third, Apple is expected to introduce an updated iPad tablet computer in time for holiday sales. Last year's model fell short of initial sales estimates, and a top complaint was its chunkiness; it weighs nearly a pound and a half. KGI Securities analyst Mingchi Kuo, who has demonstrated a knack for predicting Apple product details, wrote last month in a note to investors that the new iPad will be 15% thinner and 25% lighter. If that's true, this year's model should fare better than last year's.

Fourth, it's not too early to begin looking forward to the iPhone 6. Next year's device is expected to have a larger screen, providing current iPhone customers with a clear reason to upgrade. And Apple is asking its suppliers to be ready to begin production one quarter earlier than usual, suggesting a June or July launch, according to Chris Caso, an analyst with Susquehanna Financial Group.

None of this hinges on a futuristic TV, watch, or other device that Apple isn't currently selling. All of it comes up against projections for modest growth; Wall Street predicts Apple will increase its revenues by less than 7% in its next fiscal year, which kicks off next month. Earnings per share are expected to rise less than 9%, to $42.71. A rise in the stock to $600 a share would put it at 14 times earnings, a valuation more in keeping with the company's growth. Alternatively, a rise to 13 times earnings combined with higher-than-expected earnings for next year could get the stock to $600.

Shares of Apple come with a dividend yield of 2.6%. The company holds cash and investments equal to more than one-third of its stock market value. It generates free cash equal to nearly 10% of its stock market value each year.

So in short, though Apple is a hyped name, its stock certainly is not.

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