Production of Apple's next generation iPhone, dubbed the iPhone 5S, will begin this month and will be available this fall, Jefferies analyst Peter Misek says.
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Misek, who has a hold rating on the stock with a price target of $405, said in a note to clients Monday that the iPhone 5S is scheduled to be available in late September or early October and that total production plans for the fourth fiscal quarter starting in September are most likely on the higher end of the firm's 25 million to 30 million estimates.
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According to Misek, Apple started making a small batch of a low-cost iPhones at the beginning of June. He noted that the company's third quarter would likely receive little to no benefit from the iPhone refresh.
Of the total FQ4 build plans, Misek estimates that about 15 million will be a low-cost version of the device, 15 million will be the iPhone 5S and no iPhone 4S models will be produced.
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For the first fiscal quarter starting in December, build plans will range from 50 million to 55 million. Misek said about 5 million of these will be iPhone 4S, 20 million of the low-cost iPhone model and 25 million iPhone 5S.
While Apple's plans for it's new products show a strong sense of confidence, Misek said that competition and a lack of significant upgrades to the new iPhone 5S could hurt sales.
"We remain cautious as our checks indicate mostly incremental feature upgrades for the iPhone 5S," he said. "The [Samsung] Galaxy S4 continues to take share and the iPhone 5S will also have to compete with Google's Moto X phone. We believe the "low-cost" iPhone will be ~$300-$400 and will not be competitive in emerging markets."
He also noted that the company has changed its focus on the low-cost iPhone in FQ1 instead of the iPhone 5S, which is a negative sign.
"We believe the change indicates that the low-cost iPhone may potentially be more cannibalistic, which would hurt both ASPs [average sales prices] and gross margins. We maintain our FQ4 (Sep) and FQ1 (Dec) shipment estimates of 26 million and 45 million, respectively," he said.
—By CNBC's Cadie Thompson. Follow her on Twitter @CadieThompson.