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Apple Poised to Soar in 2013: Experts

Monday, 31 Dec 2012 | 12:38 PM ET
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Apple will speed up its product upgrade cycle in 2013, giving the company's beaten down stock a big boost, market experts told CNBC on Monday.

"We're on the cusp of an enormous product upgrade cycle and we think Apple's earnings are going to be dynamite in the fourth quarter," said Channing Smith, Portfolio Manager at Capital Advisers Growth Fund, on CNBC's "Squawk on the Street".

How to Play Apple in 2013
Eric Jackson, Ironfire Capital founder; and Channing Smith, Capital Advisors Growth Fund, discuss some of the headwinds facing the tech giant and why this stock could be one of the hot picks next year.

Smith said he expects Apple's stock to grow 20 percent over the next few years and that he expects Apple to return to its all time highs, which it reached in September when its stock hit $702.10.

Since then, fickle investors have shaved more than a quarter from the tech giant's market capitalization, partly in fear that Apple might be losing its ability to innovate and stave off its competition.

"If you think Apple's franchise is in trouble, then you sell the stock. We don't think that's the case," Smith said.

"We think there is tremendous growth in these categories, and that earnings are going to surprise on the upside come January when we hear the earnings report," he added.

The coming launch of an iPad 5 and a new iPad mini will also help drive Apple's stock back up, Smith said.

According to Smith, digital devices will likely "triple over the next couple of years. The iPhone category should grow 25 to 30 percent, so we want Apple's to focus on these products, maintain market share and grow these product categories, and we think that is enough," he said.

Spurred by consumers holding off on purchasing an iPhone because they are waiting for the latest version, Apple will bump up its product upgrade cycle for the iPhone to a six month cycle instead of a 12 month cycle, said Eric Jackson, Ironfire Capital founder and managing director. (Read More: Tablet, Smartphone Activations Soared This Christmas )

Along with shorter upgrade cycles, Jackson said he also expects Apple to introduce some new products in 2013. That includes an iTV slated for November, and possibly even an iCar system, which would control navigation and entertainment in automobiles. (Read More: Three New Apple Patents Hint at the Future of Gadgets )

"I think Apple always vacilates between the two extremes of fear and greed, and right now I think we are kind of hitting that max fear point, with people all worried about margins and what the future products will be," Jackson said.

What will eventually help Apple, Jackson added was the day that "people get greedy again, and when people realize that the current product portfolio...[is] going to be much bigger than expected."

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