iPhone 7 Will Be A 'Super Hit', iPhone 7 Plus Could Outsell It

Trip Chowdhry of Global Equities Research thinks Apple Inc. AAPL's iPhone 7 release will be a "super hit."

Chowdhry cited an Apple statement which said that initial quantities of the iPhone 7 Plus in all finishes and the iPhone 7 in jet black have all sold out and will not be available for walk-in customers.

Chowdhry stated in an e-mail that the most notable takeaway from Apple's statement is the fact that the iPhone 7 Plus is sold out. This means it's "very likely" Apple will see higher average selling price of 18 percent and its margins "will be maintained." In fact, he suggested that the iPhone 7 Plus could outsell the base iPhone 7.

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The analyst added that photos and videos are "central to our digital lives" and this explains the strong demand for Apple's new device.

Chowdhry added that he is also expecting Apple Watch 2 sales to "accelerate" six months from now as the wearable device will "act as an extension" to the iPhone 7.

Finally, Chowdhry noted that Apple is "squeezing" margins out of its suppliers to protect its own margins. As such, buying stock in companies that make up Apple's supply chain "is not prudent" and buying Apple's stock instead "makes sense."

Shares of Apple hit a new 2016 high Wednesday, closing up more than 3.5 percent at $111.77.