Apple Inc. (NASDAQ:AAPL) earned an increased price target from BMO Capital analyst Keith Bachman, anticipating the launch of the new iPhone. The analyst has raised the price target to $685.00 from $610.00, and placed an Outperform rating on the stock. According to Bachman, the new phone with larger display along with advanced software and ecosystem will be successful in the market.

Apple iPhone 6

Larger Display phones in demand

According to the report, growth for the large screen smartphone devices with a display of 4.5”+ was 226% in 2013, and 150% in the March 2014 quarter, compared to the growth of 22% for the smartphone segment with a display size similar to that of current iPhone. Smartphones with a 4.5”+ screen clinched market share of around 47% in March 2014 quarter, emphasizing the strength of the trend.

The analyst said that if 25% of the total smartphone units in the December quarter have display of 4.5”-4.9”, or 90-95 million units, and iPhone has 20-25% share then it is anticipated that Apple Inc. (NASDAQ:AAPL) can sell around 20-22 million large screen iPhone in the December 2014 quarter.

The analyst also noted that Apple Inc. (NASDAQ:AAPL)’s latest iPhone will have even better features with a display size of 4.5”-5.0”. However, the company has been behind schedule and probably will not launch 5”+ product until CY2015.

No major effect on Apple value after split

Investors have shown greater confidence in the stock since the company announced a buyback and dividend a few months ago. Apple Inc. (NASDAQ:AAPL) also announced that there will not be any substantial effect on the actual value of the company after the split. Instead the spilt increases the number of outstanding shares by seven, and divides the value of each share by the same number, thereby causing no change in the value.

The iPhone maker suggested that it went for a 7-1 split because “we want Apple stock to be more accessible to a larger number of investors.” After the split, each share will be valued at around $92, which implies that investors will be able to trade shares in larger amounts and gives smaller investors a better opportunity to own shares.