After peaking at just above $700 last September, Apple's (NASDAQ:AAPL) stock hasn't come close to those levels since. Today, shares still trade below $600. But one analyst believes that, within 12 months, Apple stock can hit $700 once again. With a price target of $700, Evercore analyst Rob Cihra thinks shares could gain about 25% from today's levels.

Why does Cihra think Apple is undervalued? In the video below, Fool contributor Daniel Sparks breaks down Cihra's arguments for a $700 price tag for Apple shares into three points.

  1. Cihra sees momentum from Apple's refreshed iPhone and iPad line-up.
  2. He feels that Apple's current product line will help to stabilize Apple's gross profit margin.
  3. He is confident in Apple's vertical integration and its ecosystem of integrated hardware and services.

To find out what Daniel thinks of Cihra's arguments, check out the video below.

Fool contributor Daniel Sparks owns shares of Apple. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.