Amidst the fast-paced and highly competitive business environment of today, conducting comprehensive company analysis is essential for investors and industry enthusiasts. In this article, we will delve into an extensive industry comparison, evaluating Apple (NASDAQ:AAPL) in comparison to its major competitors within the Technology Hardware, Storage & Peripherals industry. By analyzing critical financial metrics, market position, and growth potential, our objective is to provide valuable insights for investors and offer a deeper understanding of 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 makes up a majority of the firm sales, and Apple’s other products like 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, like streaming video, subscription bundles, and augmented reality. The firm designs its own software and semiconductors while working with subcontractors like Foxconn and TSMC to build its products and chips. Slightly less than half of Apple’s sales come directly through its flagship stores, with a majority of sales 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 | 34.89 | 51.88 | 9.38 | 39.36% | $35.55 | $48.34 | 7.94% |
| Western Digital Corp | 29.88 | 12.32 | 7.62 | 20.57% | $1.48 | $1.23 | 27.4% |
| Pure Storage Inc | 190.63 | 17.05 | 7.12 | 4.03% | $0.1 | $0.7 | 16.05% |
| NetApp Inc | 18.65 | 21.50 | 3.30 | 31.11% | $0.47 | $1.23 | 2.83% |
| Super Micro Computer Inc | 23.72 | 2.76 | 0.91 | 2.62% | $0.25 | $0.47 | -15.49% |
| Logitech International SA | 22.17 | 6.88 | 3.12 | 7.99% | $0.22 | $0.51 | 6.27% |
| Diebold Nixdorf Inc | 50.86 | 2.22 | 0.70 | 3.73% | $0.11 | $0.25 | 1.95% |
| Turtle Beach Corp | 15.31 | 2.38 | 0.83 | 1.51% | $0.01 | $0.03 | -14.74% |
| Average | 50.17 | 9.3 | 3.37 | 10.22% | $0.38 | $0.63 | 3.47% |
Through a thorough examination of Apple, we can discern the following trends:
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With a Price to Earnings ratio of 34.89, which is 0.7x less than the industry average, the stock shows potential for growth at a reasonable price, making it an interesting consideration for market participants.
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With a Price to Book ratio of 51.88, which is 5.58x the industry average, Apple might be considered overvalued in terms of its book value, as it is trading at a higher multiple compared to its industry peers.
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With a relatively high Price to Sales ratio of 9.38, which is 2.78x the industry average, the stock might be considered overvalued based on sales performance.
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The Return on Equity (ROE) of 39.36% is 29.14% above the industry average, highlighting efficient use of equity to generate profits.
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The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $35.55 Billion is 93.55x above the industry average, highlighting stronger profitability and robust cash flow generation.
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The gross profit of $48.34 Billion is 76.73x above that of its industry, highlighting stronger profitability and higher earnings from its core operations.
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The company’s revenue growth of 7.94% exceeds the industry average of 3.47%, indicating strong sales performance and market outperformance.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio is a financial metric that helps determine the level of financial risk associated with a company’s capital structure.
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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When evaluating the debt-to-equity ratio, Apple is in the middle position among its top 4 peers.
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The company maintains a moderate level of debt relative to its equity with a debt-to-equity ratio of 1.34, suggesting a relatively balanced financial structure.
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, gross profit, and revenue growth, Apple outperforms its industry peers, reflecting strong financial performance and growth potential.
This article was generated by Benzinga’s automated content engine and reviewed by an editor.
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