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Apple Inc shares are on track to hit another milestone in terms of market capitalization, according to Wedbush Securities.

The Apple Analyst:Daniel Ives has an Outperform rating and $175 price target on Apple shares, with the bull-case price target at $225.

The Apple Thesis:After Apple'sjaw-dropping performancein the December quarter that was reported in late January, the shares of the company have taken a breather, Ives said. The weakness, the analyst said, is a short-term blip on the stock's upward trajectory.

The positive view is premised on Wedbush's Asia supply chain checks, which point to robust strength in the iPhone 12 supercycle into the rest of 2021.

"Given the fundamental strength we are seeing for this supercycle, coupled by a further re-rating on the horizon, we believe Apple will hit $3 trillion in market cap by year-end," Ives wrote in the note.

Based on the current trajectory and in a bull-case scenario, Apple has the potential to sell more than 240 million units of iPhones in the fiscal year 2021, the analyst estimates. This is higher than the current consensus forecast of 220 million units and will likely easily eclipse the previous annual record of 230 million units set by the company in the fiscal year 2015.

With about 350 million of the 950 million iPhones worldwide currently in the window of an upgrade cycle, Ives thinks this will translate to an unprecedented upgrade cycle for Apple.

ASPs are also shifting higher due to product mix shifting toward the more expensive iPhone Pro, boding well for top-line numbers, heading into the March and June quarters.

Apple's EV endeavor, according to the firm, is the right strategic move at the right time.

"If Apple gets just 5%-10% of share this could represent another major growth pillar within Cupertino and add $30+ per share to Apple's SOTP valuation," the firm said.

AAPL Price Target:Apple shares were retreating 2.4% to $126.64 Monday, after having lost about 2% year-to-date.