Once Apple starts selling its highly-anticipated iWatch, which should happen before the end of 2014, sales for the device should outpace expectations of most analysts, according to Morgan Stanley.

Morgan Stanley said in a note this week that they expect Apple to sell its iWatch for $300, with a 40 percent to 50 percent profit margin on each device sold.

Katy Huberty and her team expect 30 million to 60 million iWatch sales "in the first 12 months of availability based on historical penetration of past iDevice(s)," according to International Business Times.

Though Apple sold 5.5 million iPhones during the first 12 months that its initial device was available for, sales for iPhone devices increased to around 55 million by 2013. Brand loyalty for the iPhone rose 73 percent in the last month of 2011 to 90 percent in March 2014, according to the report.

Huberty believes Apple customer loyalty will drive iWatch sales during the first year, like the iPhone, and the company should expect to see big sales numbers after 12 months.

Morgan Stanley also raised its 12-month price target for Apple's stock from $99 to $132 per share, according to International Business Times.

The demand expected by Huberty could hit some speed bumps however.

Apple analyst Ming-Chi Kuo released a report last week saying the iWatch supply will be constrained when the device finally gets released.

"We have pushed back our estimated time of iWatch mass production from late-September to mid-/ late- November. We also lower our forecast of iWatch 2014 shipments" by 40 percent to 3 million, Kuo said in the report. Apple has faced more complex engineering feats in entering a new product category, the report reads.

Kuo believes that the device will come with a waterproof, sapphire-coated, flexible Amoled display.

Apple's recently released HealthKit software is expected to help the iWatch accumulate information about exercise.

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