tim cookApple CEO Tim Cook.REUTERS/Stringer

Apple has yet to release sales figures for the iPhone 7, but investors are already looking forward to next year's iPhone.

One bull case for Apple stock is that this year's relatively minor iPhone upgrades will create a "powder keg" of iPhone users who will wait and jump on next year's device, which is expected to be a drastic revamp with wireless charging and an edge-to-edge screen.

Not so fast, say Wells Fargo securities analysts. They warn that "bullishness on next cycles should be tempered."

There are two issues with the "powder keg" or "super cycle" bull case, according to a note distributed on Thursday to Wells Fargo clients:

"However, we believe this is the incorrect way to model iPhone units as it has two inherent flaws: 1) not all of the 500MM is what we would consider eligible (we think hand-me-down iPhones, for example, to one's child or even low-end iPhone sales in some emerging countries should not be included in the base) and 2) it ignores the cyclicality and subscriber eligibility evident from our proprietary units per carrier analysis, which suggests the iPhone 8 may have headwinds."

One of those headwinds may be the fact that carriers are basically giving the iPhone 7 away.

"The current free iPhone 7 promotions by carriers may impact the 2018 cycle as those that upgrade would see an increase in their monthly bills if they upgrade," the analysts wrote.

"Aggressive promotions of giving iPhone 7 for free may help unit sales now — carriers will credit the monthly charge for the handset to make it free. However, in two years, subscribers who want to upgrade will see their monthly bills increase $27-$32 per month unless carriers run another free iPhone promotion," the note said.

Other headwinds that Wells Fargo sees facing Apple include difficult year-over-year comparisons next year and the cyclical nature of iPhone sales. It gives Apple a "market perform" rating and a price target of $113.55.

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