The shortcoming of conventional SLT (Shear Lag Theory) is due to the neglect of stress transfer across the fiber ends, which results in the inaccurate stress variation for the fiber when the fiber aspect ratio is small in elastic loading. Thus a new model called NSLT (New Shear Lag Theory) is developed considering the stress concentration effects that exists in the matrix regions near fiber ends. In this paper the prediction of elastic composite modulus is presented to evaluate the stress transfer mechanism using NSLT. A micromechanical FEA (Finite Element Analysis) model with axisymmetry is implemented to verify the results of fiber stresses and interfacial shear stresses. It is found that the proposed model gives a reasonable prediction compared with the results based on other models.