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Despite iPad production issues, analyst sees Apple soaring

Sterne Agee analyst Shaw Wu says that Apple is facing some iPad production problems but that they can be quickly addressed and help the company's shares soar.

Despite one analyst yesterday predicting possible trouble for Apple, others see blue skies.

The iPad will keep helping improve Apple's financial position, Sterne Agee analyst Shaw Wu wrote to investors today. Wu ultimately sees the stock surging to $750 a share within the next 12 months.

Apple is currently trading around $634.

"What we are picking up are strong follow-up demand trends for the new iPad despite a very strong start of 3 million units sold in the first few days," Wu wrote to investors today. "We believe this is likely because the new iPad is a significant upgrade with an HD Retina Display, quad-core graphics, and 4G LTE wireless. In addition, the price cut on the iPad 2 appears to be helping as well."

Wu's bullish stance on Apple stands in stark contrast to what BTIG Research analyst Walter Piecyk had to say about the company yesterday. In a note to investors, Piecyk said he believes Apple is heading into a significant struggle with carriers as they try to limit the company's power across the mobile market. That, in addition to a small chance of Apple launching a "revolutionary" product this year, prompted Piecyk to downgrade Apple's shares from Buy to Neutral.

Like Wu, a number of analysts disagree with Piecyk and believe Apple is a solid buy. Last week, Piper Jaffray analyst Gene Munster, who has been following Apple for years, said that the company could top $1,000 per share and reach a market capitalization of $1 trillion. Topeka Capital Markets' Brian White also said Apple's stock could rise to $1,000. On average, 53 analysts following Apple's shares believe it will hit $673.80 within the next 12 months.

Wu did acknowledge that Apple appears to be having some trouble getting iPads out of its factories in Asia. He cautioned that the shipments are constrained not by demand, but by supply of the Retina Display. In addition, Foxconn's recent decision to limit overtime hours to 36 hours per month following the Fair Labor Association's audit is reducing employee productivity.

Despite those troubles, Wu believes Apple will resolves its issues quickly and get its supply issues under control over the "next few quarters as additional production lines and suppliers are added."

So, how many iPads might Apple ship? Wu believes that the company shipped as many as 12.3 million iPads in the March quarter and could reach 63 million by the end of 2012.

Apple did not immediately respond to CNET's request for comment on Wu's claims that iPad production is slowing. It is worth noting, however, that customers who buy the new iPad right now must wait between one week and two weeks for the device to ship.