When it comes to Apple Inc. (NASDAQ: AAPL), all the focus tends to be around the iPhone. According to a report from Argus, in which the independent research firm handily raised its price target above consensus, the iPhone strength is succeeding in bringing Apple customers into a broader ecosphere for Mac sales and services.

Argus reiterated its Buy rating and raised its price target to $210 from $185, implying roughly 22% upside from the most recent closing price of $172.50. The firm gave its investment thesis as follows:

We believe the new phones will prompt a strong upgrade cycle worldwide, which should be evident in the current fiscal 1Q18 but may also carry through into fiscal 2Q18, which includes the Chinese New Year. Although AAPL is well ahead of the market and peers year-to-date, the stock is inexpensive based on relative valuation. We believe that Apple’s positives are not fully reflected in the share price.

This most recent quarter was notable for several new devices joining the lineup, including the iPhone 8 and 8 Plus, Apple TV 4K and Apple Watch 3. While iPhone 8 and 8 Plus appeared to generate a lukewarm response, the sales numbers suggest strong underlying demand for the new phones, as well as for the legacy iPhone 7 and 6s. The just-released iPhone X, with its 3D sensing and facial recognition technology, at first glance looks like a hit, generating pre-opening lines in front of Apple stores in the manner of earlier Apple devices.

Again looking at this quarter, there were some other surprises Argus pointed out:

The biggest beat against our model came from the Mac. Unit sales for Apple’s PCs were up 10% year-over-year, to 5.4 million. Full-year unit sales were a record 19.3 million. The big driver was Mac ASPs, which rose 13% annually to $1,343 per device. Total revenue of $7.2 billion jumped 25%, driven by notebook refreshes introduced in June; Mac also had a strong back-to-school season. The MacOS High Sierra operating system is also driving sales by making Mac more capable and responsive, according to Mr. Cook.

The strength in Services was not a shock given how fast this category has been expanding, but its magnitude was a surprise. Service revenue of $8.5 billion rose 34% annually and 17% sequentially. Apple is well on its way to meeting its goal of doubling services revenue from $24 billion in fiscal 2016 to $48 billion by fiscal 2020. The products category grew 36% annually, to $3.2 billion, as Apple Watch saw 50% growth in unit sales.

At the same time, Apple’s top-line growth is outpacing expense growth, leading to expanding margins. The legal battle with Qualcomm is raging on, but Argus believes that this is likely a bigger deal for Qualcomm than for Apple. China finally has swung back to year-over-year growth in the fiscal fourth quarter. This is coming early in the new phone cycle, and the rebound also may suggest a strong calendar fourth quarter in the Chinese market.

Looking ahead to the Christmas quarter, Apple projected record holiday-quarter (fiscal 1Q18) revenue of $84 billion to $87 billion, which at the midpoint would be up 9% year over year. The guidance suggests another record quarter for iPhone as well, along with the usual strong holiday results for the iPad and Products.

Shares of Apple were last seen at $174.82, with a consensus analyst price target of $175.19 and a 52-week range of $104.08 to $174.91.

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