A new report from Canaccord Genuity, a research firm that forms part of Canaccord Financial Inc. (LON:CF), says that the indicators are showing a slowdown in the sales of the Apple Inc. (NASDAQ:AAPL) iPhone. The report became available today and sets a price target of $775 for the tech giant.

The reason for the perceived slowdown is of course the anticipation of an update to the iPhone line in the form of the iPhone 5. The research firm estimates that Apple will sell just 27 million iPhones up to the end of June. That compares with 35 million in the last quarter or a fall of 23%.

The analyst’s own research suggests that despite remaining the top selling smart phone in the United States, sales of the iPhone 4S are slowing. It is of course expected that sales of the product will pick up very quickly as soon as the new model becomes available and pent up demand for the newer technology expresses itself.

The firm sees Android’s continuing overall dominance and Motorola’s generous promotion of its RAZR line as nipping at the sales of the iPhone at Verizon Communications Inc. (NYSE:VZ). At Sprint Nextel Corp. (NYSE:S) the report cites the carrier’s  continuing push to sell HTC products and and the Nokia Lumia 900 at AT&T Inc. (NYSE:T) as reasons for the slow in sales.

Despite the slowing of iPhone sales the product remains the most popular smart phone in the United States. This bodes well for the successful release of the iPhone 5. Verizon has introduced newer more affordable plans for its LTE network. That could be a clincher come the new release.

The report assumes only two things about the new smartphone, that it will be LTE enabled and it will have a substantially different design. It does not go into the specifics of what effect other specifications might have on the sales performance of the phone.

With those assumptions in mind a strong performance is expected from the iPhone 5. The firm expects a continued slump until then. In this quarter forecasted sales are 27 million units, in the next they are 24 million but in the first quarter of 2013, or Apple’s calendar year ending quarter, sales are expected to leap to 50 million.

Those numbers justify the price target of $775 on Apple shares which represents a multiple of 14 on expected 2013 earnings. Apple may be selling less iPhones but it is not going to suffer from as it stays ahead of the curve in smart phone technology, marketing and sales.