Apple shares reached an all-time high yesterday, gaining $2.13 per share (2 per cent) to close at $88.60.

With analyst consensus on top value presently favouring the region between $90-$101 per share, the company is currently trading near its highest market valuation.

Apple's rumoured launch of an iPhone, observations of strong iPod sales this season, and high expectations for Apple's hardware and software product road map in 2007 all drive shares upwards.

Investors are also considering next year's battle for desktop operating systems between Apple and Microsoft. A JMP Securities analyst report on Barons explains the situation isn't cut and dried - Microsoft may shed users who will then switch to the Mac.

That report suggests Microsoft needs to be ready for slow adoption of its new operating system, and points out that the migration from a previous version of Windows to the new one could be seen by some potential switchers as a reason to move to Mac.

"We believe that the fact that Vista is designed to be much like Mac OS X will, in the consumer's mind, make the transition from using XP to Vista very comparable to making the transition from XP to Mac OS X. We believe this could provide ample opportunity for Apple to gain greater market share with consumers. With Apple's next-generation operating system, Leopard, due in April 2007, we believe Apple will continue to stay more than a step in front of Microsoft," the report concludes.