As shares of Apple Inc. (AAPL) bounce back from lows reached earlier this month, one team of bulls on the Street foresees strength in its Chinese segment, upcoming share buybacks and its services business to propel the FAANG stock to new highs. 

Trading up about 0.8% on Tuesday morning at $173.82, AAPL reflects a 2.5% gain year-to-date (YTD), making a comeback from a sell-off following its most recent fiscal first-quarter earnings report in which investors feared a slowing demand for its smartphones. The S&P 500 has increased 2% over the same period. (See also: Apple Is a Safe Bet Amid ‘Market Turmoil’: BofA.)

In a research note on Friday, GBH Insights analyst Dan Ives wrote that the "Street is finally seeing the forest though the trees as the March guidance hangover appears to have dissipated." He expects AAPL to gain more than 18% over the next 12 months to $205. 

Investor Benefits From 'Cash Neutrality'

The GBH analyst estimates that Apple has approximately 350 million iPhones that are in the window of opportunity to upgrade over the next 12 to 18 months. "Now it's about which model and price point 'strike a chord' for these customers to ultimately upgrade as the iPhone X demand has softened." Ives expects the Cupertino, Calif.-based tech titan to release three new phones this year, helping to reel in customers turned off by the 10th anniversary iPhone's $999 starting price point. Additionally, 60 million to 70 million Chinese consumers due for an upgrade should be drawn to Apple's "unparalleled consumer franchise," wrote the analyst.  

Ives foresees Apple's services segment, made up of its high-growth music streaming platform Apple Music, along with Apple Care and App Store, to rake in $50 billion in annual revenue by 2020. Further, following a UBS report last week suggesting that Apple plans to become "cash neutral," bulls see shareholders gaining on major dividends and share buybacks. 

"In a nutshell, while this is a hand-holding period on the name, we believe near-term turbulence does not change out long-term bullish thesis on Apple," said Ives. (See also: Apple Music Challenges Spotify Ahead of IPO.)