by , 11:20 AM EDT, May 8th, 2006

UBS released a report on Monday showing a strong demand for Apple's Intel-based MacBook Pro laptop, and sees strong growth potential for both the Mac and iPod product lines. The investment analysis firm also expects that we will see the introduction of an Intel-based replacement for the iBook as early as Tuesday, which will likely drive interest in Apple's portable product line higher.

On the Mac Front
Consumer interest in the Intel-based Mac mini has been positive, too. Initial sales have been stronger than expected, and are attributed to consumers looking for a low-cost entry point Mac option, along with a Mac-based digital home media center. Sales to professional and "prosumer" users have been somewhat soft since these users are waiting the Intel replacement for the Power Mac G5 and Universal Binary versions of Adobe products like Photoshop, InDesign, and Illustrator.

The pending introduction of the iBook replacement, presumably to be called the MacBook, should help spur Mac sales momentum moving in to the third fiscal quarter. The successor to the Power Mac G5, which UBS expects to ship in August at the World Wide Developers Forum, will help push Mac sales growth up 9 percent to 5 million units for fiscal 2006.

Looking at the iPod
Although iPod quarterly sales are down, they are still healthy and in line with seasonal expectations. The iPod still remains the consumer's MP3 player of choice, despite an overall market slowdown in music player sales. UBS also sees a growing trend in video capable iPod sales as more content becomes available.

Looking forward, analysts are predicting that Apple will transition its 30GB and 60GB iPod models to 40GB and 80GB versions with larger screens by the fall. The iPod nano may see capacity increases from 2GB and 4GB up to 6GB and 8GB, along with an improved Click Wheel and more durable surface by the end of the year. Price reductions for the current iPod models may also be in store.

UBS doesn't see an iPod/cell phone product from Apple this year, but it is a possibility for 2007. We may also see the introduction of iPod models that include voice recognition technology, allowing users to control their iPod via spoken commands. Analysts also feel that Apple is working on a larger portable video device that will be similar to the iPod, but is unsure if it will be available in time for the holiday shopping season.

UBS is maintaining its "Buy" rating for Apple, and expects to see a 34 percent growth in iPod sales for the quarter, and an 82 percent growth for the year with 40.9 million units sold.

Apple stock is currently trading at US$72.31, up 0.42 (0.58%).