Investigating Apple's Standing In Technology Hardware, Storage & Peripherals Industry Compared To Competitors

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 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.

Through a meticulous analysis of Apple, we can observe the following trends:

• A Price to Earnings ratio of 39.97 significantly below the industry average by 0.9x suggests undervaluation. This can make the stock appealing for those seeking growth.

• It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 64.5 which exceeds the industry average by 9.8x.

• The Price to Sales ratio of 9.58, which is 4.22x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.

• The company has a higher Return on Equity (ROE) of 23.83%, which is 16.24% above the industry average. This suggests efficient use of equity to generate profits and demonstrates profitability and growth potential.

• With higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $32.5 Billion, which is 95.59x above the industry average, the company demonstrates stronger profitability and robust cash flow generation.

• With higher gross profit of $43.88 Billion, which indicates 60.94x above the industry average, the company demonstrates stronger profitability and higher earnings from its core operations.

• The company's revenue growth of 6.07% is significantly lower compared to the industry average of 167.37%. This indicates a potential fall in the company's sales performance.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio indicates the proportion of debt and equity used by a company to finance its assets and operations.

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.

By analyzing Apple in relation to its top 4 peers based on the Debt-to-Equity ratio, the following insights can be derived:

• Compared to its top 4 peers, Apple has a moderate debt-to-equity ratio of 1.87, indicating a balanced financial structure.

• This suggests that the company maintains a reasonable level of debt while also leveraging equity financing.

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 Apple's assets and sales highly. Apple's high ROE, EBITDA, and gross profit reflect strong profitability, while the low revenue growth implies slower expansion compared to industry peers.

This article was generated by Benzinga's automated content engine and reviewed by an editor.