In the ever-changing and fiercely competitive business landscape, conducting thorough company analysis is crucial for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating Apple (NASDAQ:AAPL) and its primary competitors in the Technology Hardware, Storage & Peripherals industry. By closely examining key financial metrics, market position, and growth prospects, our aim is to provide valuable insights for investors and shed light on company’s performance within 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 | 37.13 | 55.51 | 9.99 | 39.36% | $35.55 | $48.34 | 7.94% |
| Western Digital Corp | 21.89 | 9.02 | 5.58 | 20.57% | $1.48 | $1.23 | 27.4% |
| Hewlett Packard Enterprise Co | 25.13 | 1.15 | 0.86 | 1.14% | $1.11 | $2.67 | 18.5% |
| Pure Storage Inc | 202.80 | 20.72 | 8.45 | 3.68% | $0.09 | $0.6 | 12.73% |
| NetApp Inc | 19.42 | 22.57 | 3.43 | 23.13% | $0.38 | $1.1 | 1.17% |
| Super Micro Computer Inc | 25.57 | 2.97 | 0.98 | 2.62% | $0.25 | $0.47 | -15.49% |
| Logitech International SA | 25.55 | 7.93 | 3.60 | 7.99% | $0.22 | $0.51 | 6.27% |
| Diebold Nixdorf Inc | 47.41 | 2.07 | 0.65 | 3.73% | $0.11 | $0.25 | 1.95% |
| Turtle Beach Corp | 15.42 | 2.39 | 0.83 | 1.51% | $0.01 | $0.03 | -14.74% |
| Average | 47.9 | 8.6 | 3.05 | 8.05% | $0.46 | $0.86 | 4.72% |
By closely studying Apple, we can observe the following trends:
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At 37.13, the stock’s Price to Earnings ratio is 0.78x less than the industry average, suggesting favorable growth potential.
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With a Price to Book ratio of 55.51, which is 6.45x 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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The Price to Sales ratio of 9.99, which is 3.28x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.
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The Return on Equity (ROE) of 39.36% is 31.31% above the industry average, highlighting efficient use of equity to generate profits.
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With higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $35.55 Billion, which is 77.28x above the industry average, the company demonstrates stronger profitability and robust cash flow generation.
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Compared to its industry, the company has higher gross profit of $48.34 Billion, which indicates 56.21x above the industry average, indicating 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 4.72%, indicating strong sales performance and market outperformance.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio is an important measure to assess the financial structure and risk profile of a company.
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, PB, and PS ratios indicate that the stock is relatively undervalued compared to its peers. However, the high ROE, EBITDA, gross profit, and revenue growth suggest that Apple is performing exceptionally well within the industry. These metrics highlight Apple’s strong financial performance and growth potential in the market.
This article was generated by Benzinga’s automated content engine and reviewed by an editor.
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