By Josh Ong

Published: 12:18 AM EST (09:18 PM PST)

Following Apple's unveiling of the iPhone 4S on Tuesday, Wall Street's response was relatively subdued, though analysts remain optimistic that Apple sales growth will continue to rise.

Apple took the wraps off the iPhone 4S at its "Let's Talk iPhone" event. The fifth-generation handset is a "world phone" that carries the same external form factor as the iPhone 4, but boasts a faster processor, improved antenna design and new Siri voice recognition functionality.

Shares of Apple experienced volatility on Tuesday in light of Apple's announcements. The stock slide from a close of $374.60 on Monday to as low as $355.18 during the day on Tuesday, before rallying back to close at $372.50, down just 0.56 percent.

The general response by the public appears to be largely underwhelmed. But, several Wall Street analysts noted the disappointment, while also reiterating their confidence in Apple's continued growth.

Piper Jaffray

Piper Jaffray analyst Gene Munster sent a note to investors saying that Apple's announcements at its "Let's Talk iPhone" event were in line with expectations.

"The bottom line is that while investors may be disappointed by the lack of a redesigned iPhone, we believe the iPhone 4S will meet or exceed unit expectations, as it represents the first iPhone launch at two major US carriers (Verizon and Sprint) along with KDDI in Japan," he wrote.

Munster believes the launch of the device will attract long lines, based on survey data from August. According to him, there is pent up demand for the iPhone 4S, as 64 percent of mobile phone users surveyed in August indicated plans to buy an iPhone the next time they purchase a new phone, with 36 percent of those surveyed saying they would wait for the "iPhone 5." But, it should be noted that the survey had a small sample size of just 216 respondents.



Verizon and Sprint are expected to give Apple a sales boost, even without a redesign of the iPhone's externals. Munster remains comfortable with his 25 million unit estimate, given the level of demand expected from the two carriers. According to him, Sprint should have the highest backlog of demand, though large numbers of Verizon customers who passed on the iPhone 4 and have been waiting for a next-generation Apple handset are also predicted to buy the iPhone 4S.

74 percent of Verizon subscribers who do not have an iPhone but plan to buy one as their next mobile phone were waiting specifically for the fifth-generation model, compared to 53 percent of AT&T subscribers, Munster noted.

RBC

Analyst Mike Abramsky said Tuesday that a drop in Apple's stock price was "not unexpected" because the announcements only met expectations. He remarked that updates in the iPhone 4S and iOS 5 are "largely evolutionary," though he did note that the Siri voice assistant was "cool."

The analyst recommends investors buy shares of Apple on weakness, as he remains positive on Apple in the longer-term.

"Similar to the iPhone 3GS (which was evolutionary vs. the iPhone 3G), we believe investors should not underestimate the potential upgrade cycle of the iPhone 4S," he said, adding that RBC survey data shows "unprecedented" demand for the iPhone 4S.

Abramksy sees iCloud and iOS 5 as important differentiators that will help lock users into the Apple ecosystem. Also, the addition of Sprint as an Apple carrier partner will expand the iPhone's addressable market by 25 percent in the U.S.

He pointed out that the new $0 iPhone 3GS will psychologically provide a "compelling offer" to consumers, potential doubling Apple's addressable market to 150 million smartphones per year.

On page 2 of 2: J.P. Morgan, UBS and Morgan Stanley.