Apple to Step Up iPhone Size: Pro

Apple could release both a cheaper iPhone, as well as a larger smartphone as early as this fall, Steve Milunovich of UBS said Thursday.

"We do think next year you might see a larger form factor from Apple," he said. "I would guess, though, maybe 4.8 inches. I'm not sure they're going to go all the way to, say, 5 or 6, as some of the Android players are. Our supply checks don't see that phone yet."

Shares of Apple gained 0.87 percent to close at $435.96.

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On CNBC's "Fast Money," Milunovich said that consumers could see the new phones as early as this fall.

Channel checks didn't appear to show that Apple would go head to head with the likes of Google, Samsung and HTC's 5- and 6-inch-screen smartphones, he added.

Milunovich cited CEO Tim Cook's keynote address at Apple's Worldwide Developers Conference, in which he said that the company's focus was on better products, not more products.

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"There's good rationale for having that view. They are a premium brand, and they can't afford to chase everything in the marketplace, so I think they're going to make that tradeoff," he said. "In the short term, that may not be what Wall Street wants to see. But in the long term, I think there's a lot of brand equity value there that they do need to protect."

As for a low-cost iPhone, Milunovich said that Apple's price point would likely be higher than some analysts were expecting.

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"The problem is, we're thinking $350 to $400, which isn't really a low-end phone," he said. "That's at best a mid-range phone in emerging markets. I'm not sure they're going to go much lower than that."

Trader disclosure: On June 13, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Guy Adami is long C; Guy Adami is long GS; Guy Adami is long INTC; Guy Adami is long MSFT; Guy Adami is long AGU; Guy Adami is long NUE; Guy Adami is long BTU; Guy Adami's wife, Linda Snow, works at Merck; Brian Kelly is long TLT; Brian Kelly is long Treasuries; Brian Kelly is long Australian dollar; Karen Finerman is long AAPL; Karen Finerman is long BAC; Karen Finerman is long C; Karen Finerman is long JPM; Karen Finerman is long TGT; Karen Finerman is long GOOG; Karen Finerman is long M; Karen Finerman is long SPY; Karen Finerman is long MDY PUTS; Jon Najarian is long INTC; Jon Najarian is long WMT; Jon Najarian is long BBRY; Jon Najarian is long MSFT; Jon Najarian is long DIS; Jon Najarian is long DDD; Jon Najarian is long FNSR; Jon Najarian is long NTAP; Jon Najarian is long OC; Jon Najarian is long TMO; Jon Najarian is short GLD PUTS.