Apple Inc. (Nasdaq: AAPL ) stock took a slight dip after Toyko's Nikkei newspaper reported late last week that Apple is reducing iPhone component production by 20 percent. While investors are understandably concerned about what the production cuts suggest about iPhone demand, analysts say the market may be missing the bigger picture.

According to BlueFin Research Partners analyst John Donovan, Apple has removed roughly 12 million 2018 model iPhones from its build schedule for the second half of 2018, but it has also increased iPhone 7 builds by 9 million.

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"Following a similar pattern that we have seen earlier this year, Apple has modestly cut 2018 model iPhone builds while largely offsetting these cuts with increased builds of the existing models," Donovan says.

Donovan estimates the aggregate 2018 iPhone build total has declined by about 8 million units, or about 3.6 percent of BlueFin's full-year projected total. This modest reduction is a far cry from the 20 percent estimates initially reported by the media.

On top of a potentially misleading iPhone production cut, Donovan says Apple is entering a unique period in the iPhone's history. Donovan says it's unlikely that the batch of new iPhone models expected to be unveiled in September will drive a near-term super-cycle of buying, but pent-up demand could trigger a new "super-long cycle" for the iPhone starting in 2019.

"As we research the outlook for all iPhones, we continue to hear that upgrade activity over the past one to two cycles was below historical patterns and expectations for myriad reasons and expectations are for an extended demand for these new iPhones, which reach across multiple platforms," Donovan says.

GBH Insights head of technology research Daniel Ives is also expecting a major iPhone upgrade cycle coming in the next several quarters.

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"In particular, we estimate between 60 million and 70 million Chinese iPhones will be in the upgrade window over the next 12 to 18 months, with iPhone X and the next launches as a major potential product catalyst in the all important Chinese market," Ives says.

GBH Insights has a "highly attractive" rating and $200 price target for AAPL stock .

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