In-Depth Analysis: Apple Versus Competitors In Technology Hardware, Storage & Peripherals Industry

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 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.

Through a thorough examination of Apple, we can discern the following trends:

• The Price to Earnings ratio of 37.02 is 0.88x lower than the industry average, indicating potential undervaluation for the stock.

• With a Price to Book ratio of 52.48, which is 7.5x 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.

• The Price to Sales ratio of 9.02, which is 3.97x 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 58.74%, which is 51.31% above the industry average. This suggests efficient use of equity to generate profits and demonstrates profitability and growth potential.

• The company has higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $45.91 Billion, which is 109.31x above the industry average, indicating stronger profitability and robust cash flow generation.

• The gross profit of $58.27 Billion is 71.06x above that of its industry, highlighting stronger profitability and higher earnings from its core operations.

• The company's revenue growth of 3.95% is significantly lower compared to the industry average of 21.69%. This indicates a potential fall in the company's sales performance.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio helps evaluate the capital structure and financial leverage 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 light of the Debt-to-Equity ratio, a comparison between Apple and its top 4 peers reveals the following information:

• Compared to its top 4 peers, Apple has a moderate debt-to-equity ratio of 1.45, 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, PB, and PS ratios indicate that the stock is relatively undervalued compared to its peers. However, the high ROE, EBITDA, gross profit, and low revenue growth suggest that Apple is efficiently utilizing its resources and generating strong profits, despite slower revenue growth. Overall, Apple's financial performance is solid, with room for potential growth in the future.

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