Analysts Says Apple Shares Have ‘Substantial Upside’ Over Next Two Years

As Apple continues to hover just below a $3 trillion USD market capitalization, Neuberger Berman analyst Daniel Flax said Tuesday that further growth for the iPhone maker will depend on its ability to engage users and break into new categories.

“It’s all about being to redefine the user experience, to redefine categories,” he told CNBC.

With an upswing that started in mid-November, Apple has set a series of new highs lately, coming within striking distance of becoming the world’s first $3 trillion USD company. So far, the stock has remained below this level, slipping less than 1 percent in Tuesday’s intraday action and sitting with a market cap of about $2.94 trillion USD.

Flax argued that Apple’s ability to sustain high growth rates over several decades comes from its ability to expand its reach and involve creators and users in its ecosystem.

“It’s not just them. It’s this notion of bringing others along with them,” he said.

Flax noted how the company had achieved this in the past, first launching the iPod and then complementing that with iTunes, a service offering that then expanded over the years to become a massive business in its own right.

Looking ahead, the analyst highlighted further opportunities in wearables and in burgeoning segments, like healthcare.

The analyst also noted that the Cupertino company could continue to innovate within its current product lines. As an example, he suggested the company could use 3D sensing in its iPhone cameras “to give a whole new view of the world.”

“I see that as one of many examples of where they are going to take an experience and bring it to a new level,” he said.