With the expected release of the iPhone 8 this fall, Apple is only in the "early stages" of unlocking upside potential for investors, Drexel Hamilton's Brian White wrote in a note to clients Monday.
"We believe Apple remains among the most underappreciated stocks in the world," White said.
The analyst raised his 12-month price forecast for Apple stock to $202 from $185, reiterating a buy rating on the shares. Apple closed Friday at $148.96 per share. If the stock climbed to White's target (a gain of more than 35 percent), that would give the iPhone juggernaut a market value of $1.05 trillion based on its current share count of 5.2 billion.
White said his 12-month price target is based on applying a 16 P-E to his 2018 pro forma EPS estimate of $10.49 and then adding the company's cash per share. The analyst argues this is more than reasonable considering the currently trades at 16 times 2018 estimated earnings.
White's price target marks the highest for the company among 33 Wall Street analysts who cover Apple, according to data from TipRanks. The average price target of those analysts is $159, and the lowest is $120, TipRanks said.
"Apple's valuation has been depressed for years as investors grew concerned that Apple would fall victim to the missteps of consumer electronic companies of the past," White wrote. "However, Apple has proven its resilience through its unique ability to develop hardware,
As of Friday's close, shares of Apple have risen 60 percent over the past 12 months and are up about 29 percent this year.
—CNBC's Michael Bloom contributed to this report.