In the fast-paced and highly competitive business world of today, conducting thorough company analysis is essential for investors and industry observers. In this article, we will conduct an extensive industry comparison, evaluating Apple (NASDAQ:AAPL) in relation to its major competitors in the Technology Hardware, Storage & Peripherals industry. Through a detailed examination of key financial metrics, market standing, and growth prospects, our objective is to provide valuable insights and illuminate company’s performance in the industry.
Apple Background
Apple is among the largest companies in the world, with a broad portfolio of hardware and software products targeted at consumers and businesses. Apple’s iPhone accounts for the majority of the firm’s sales, and Apple’s other products, such as the Mac, iPad, and Watch, are designed around the iPhone as the focal point of an expansive software ecosystem. Apple has progressively worked to add new applications, such as streaming video, subscription bundles, and augmented reality. The firm designs its own software and semiconductors and works with subcontractors such as Foxconn and TSMC to build its products and chips. Slightly less than half of Apple’s sales come directly through its flagship stores, with the majority coming indirectly through partnerships and distribution.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| Apple Inc | 39.33 | 46.55 | 10.86 | 27.84% | $39.02 | $54.77 | 16.36% |
| SanDisk Corp | 19.03 | 12.89 | 10.74 | 46.78% | $7.89 | $7.58 | 371.59% |
| Seagate Technology Holdings PLC | 51.33 | 74.87 | 13.40 | 79.34% | $1.64 | $1.9 | 48.49% |
| Western Digital Corp | 13.53 | 15.38 | 10.79 | 34.3% | $3.36 | $2.03 | 43.84% |
| Hewlett Packard Enterprise Co | 32.53 | 3.16 | 2.13 | 5.83% | $2.33 | $4.9 | 33.68% |
| Everpure Inc | 193.82 | 30.60 | 11.51 | 4.97% | $0.11 | $0.81 | 37.73% |
| NetApp Inc | 31.38 | 29.19 | 6.02 | 26.35% | $0.55 | $1.42 | 29.89% |
| Super Micro Computer Inc | 10.98 | 2.29 | 0.64 | 12.83% | $1.57 | $1.94 | 93.16% |
| Logitech International SA | 18.55 | 6.15 | 3.02 | 10.33% | $0.28 | $0.61 | 6.93% |
| Diebold Nixdorf Inc | 21.29 | 2.25 | 0.60 | 1.56% | $0.09 | $0.24 | 1.7% |
| Corsair Gaming Inc | 42.55 | 2.15 | 0.98 | 1.04% | $0.02 | $0.1 | -1.8% |
| Immersion Corp | 20.84 | 0.79 | 0.14 | 1.93% | $0.01 | $0.06 | 0.81% |
| Average | 41.44 | 16.34 | 5.45 | 20.48% | $1.62 | $1.96 | 60.55% |
Through a meticulous analysis of Apple, we can observe the following trends:
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At 39.33, the stock’s Price to Earnings ratio is 0.95x less than the industry average, suggesting favorable growth potential.
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The elevated Price to Book ratio of 46.55 relative to the industry average by 2.85x suggests company might be overvalued based on its book value.
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The Price to Sales ratio of 10.86, which is 1.99x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.
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With a Return on Equity (ROE) of 27.84% that is 7.36% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.
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With higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $39.02 Billion, which is 24.09x above the industry average, the company demonstrates stronger profitability and robust cash flow generation.
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The company has higher gross profit of $54.77 Billion, which indicates 27.94x above the industry average, indicating stronger profitability and higher earnings from its core operations.
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The company’s revenue growth of 16.36% is significantly lower compared to the industry average of 60.55%. This indicates a potential fall in the company’s sales performance.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio is a measure that indicates the level of debt a company has taken on relative to the value of its assets net of liabilities.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company’s financial health and risk profile, aiding in informed decision-making.
In terms of the Debt-to-Equity ratio, Apple stands in comparison with its top 4 peers, leading to the following comparisons:
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In terms of the debt-to-equity ratio, Apple has a lower level of debt compared to its top 4 peers, indicating a stronger financial position.
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This implies that the company relies less on debt financing and has a more favorable balance between debt and equity with a lower debt-to-equity ratio of 0.78.
Key Takeaways
For Apple in the Technology Hardware, Storage & Peripherals industry, the PE ratio is low compared to peers, indicating potential undervaluation. The high PB and PS ratios suggest that the market values the company’s assets and sales highly. In terms of ROE, EBITDA, and gross profit, Apple demonstrates strong performance compared to industry peers. However, the low revenue growth rate may be a concern for long-term prospects.
This article was generated by Benzinga’s automated content engine and reviewed by an editor.