Morgan Stanley hiked its price target on Apple , saying it's time to consider the company's plans to launch an augmented reality product and self-driving car in the next few years. "Apple should benefit from a flight to quality especially as upside from new product categories gets priced-in," Morgan Stanley's Katy Huberty said in a note Tuesday. "Near-term, iPhone supply and App Store are surprising to the upside and drive our December quarter estimates higher." Huberty raised her price target on the stock to $200, which is 21% higher than Apple's close Monday. The analyst maintained an overweight rating on the stock. Shares rose 2.1% in premarket trading Tuesday. Apple is notoriously guarded about new product plans, but one top analyst believes AR glasses could launch by 2022. On the vehicle front, a November report said Apple wants to build a self-driving car as soon as 2025. "Today, we know that Apple is working on products to address two significantly large markets – AR/VR and Autonomous Vehicles – and as we get closer to these products becoming a reality, we believe valuation would need to reflect the optionality of these future opportunities," Huberty said. Apple shares have risen nearly 500% over the past five years, while iPhone revenue has grown just 40% over the same period, Morgan Stanley noted. That suggests new revenue streams, rather than the iPhone, have driven most of Apple's recent price action, according to the firm. "Despite a consistent and material revenue contribution from new products and services over time, Apple shares don't seem to bake-in the impact from upcoming new product launches. We believe this will change as Apple approaches the launch of an AR/VR product over the next year," Huberty said. In the near term, improving iPhone supply and App Store revenue should lead to a better-than-expected December quarter, according to Morgan Stanley. —CNBC's Michael Bloom contributed reporting.