Analyst sees China's growing middle class as the underappreciated driver of future growth.

Click to enlarge. Source: Morgan Stanley

Morgan Stanley's Katy Huberty, whose Apple (AAPL) forecasts have turned increasingly bullish in the past year (see Morgan Stanley drinks the Apple Kool-Aid), has issued her most optimistic report to date.

In her "bull case" scenario, Apple ships 80 million iPhones and 40 million iPads in calendar 2011, driving its stock to $500 a share by next August.

Apple closed Wednesday at $312.80, up $3.44 (1.11%) for the day.

The key to Apple's future growth, according to Huberty: 50 million Chinese, many of them urban, college-educated baby boomers from single-child homes with access to their parents' savings, good pension plans and a taste for "aspirational brands" like iPhones, iPods and iPads.

Apple, Huberty writes, is on a trajectory in China similar to BMW (BMW.HM), an aspirational car for a developing country if there ever was one.

"Despite the lack of financing and overall lower average income," she writes, "China will account for 11% of BMW revenue and 17% of OpInc this year, according to our European auto analyst Stuart Pearson, due to a 4x increase in dealers over the past five years."

Among the signs that Apple is making similar investments in distribution and could be headed for a similar trajectory, she cites:

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