Instinet analyst Jeffrey Kvaal wrote Tuesday that he sees "new drivers brewing" for Apple Inc. , even as iPhone X demand seems to be falling short of the company's initial expectations. In a note to clients, Kvaal argued that the "era of supercycle may be over," but he's optimistic about the potential for secondhand phone sales to continue growing the company's installed base. He noted that Apple's base did in fact grow during the latest quarter, which to him "implies services - and perhaps the Watch - can emerge as meaningful drivers by ~2020." Kvaal believes that the services business could account for more than a third of the company's overall gross profit dollars by 2020. Still, he kept his neutral rating on the stock. Apple shares are down 0.2% in Tuesday morning trading and up 22% over the past 12 months. The Dow Jones Industrial Average has gained 20% in that time.