Dan Ives Breaks Down Apple's Valuation: 'We Could See This Ultimately At $3.5T'

Apple is only about 5% away from reaching a $3-trillion market cap, which would make it the equivalent of the fifth-largest economy in the world.

Wedbush Securities analyst Dan Ives says $3.5 trillion is in the cards over the next year. 

"I think sum-of-the-parts, this is not just $3 trillion, we could see this ultimately at $3.5 trillion," Ives said Thursday on CNBC's "Squawk Box."

The iPhone: The Street is underestimating the growth in terms of iPhone 13, Ives said.. The second step of the super cycle is playing out, as iPhone 13 demand is outpacing supply by about 15%, he said.

See Also: Apple Analyst: Cupertino's Stock Is Attractive Versus Other Mega Caps Despite Valuation

Apple Glass: Ives also expects Apple to release its Apple Glass product using augmented and virtual reality next year. 

"We believe in 2022, by summer, we do get the Apple Glass mixed AR/VR headset. We think price point could be about $1,000," he said.

"This is key because we believe this could add about $20 per share to the sum-of-the-parts for Apple and that's not baked into the stock in our opinion."

Services: Apple's services business has been a big part of the most recent re-ratings for the stock, Ives said.

He told CNBC that he thinks Apple's services business represents about $1.5 trillion in value alone and is expected to generate about $80 billion in annual revenue. 

"I think you put this all together and it's sort of golden age now for Apple in this renaissance of growth that Cook is leading in Cupertino."

AAPL Price Action: Apple has traded as high as $175.96 and as low as $116.21 over a 52-week period.

The stock was up 0.77% at $176.42 Thursday morning. 

Photo: courtesy of Apple.