Performance Comparison: Apple And Competitors In Technology Hardware, Storage & Peripherals Industry

In today's rapidly evolving and fiercely competitive business landscape, it is crucial for investors and industry analysts to conduct comprehensive company evaluations. In this article, we will undertake an in-depth industry comparison, assessing Apple AAPL alongside its primary competitors in the Technology Hardware, Storage & Peripherals industry. By meticulously examining crucial financial indicators, market positioning, and growth potential, we aim to provide valuable insights to 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.

By closely studying Apple, we can observe the following trends:

• The Price to Earnings ratio of 37.5 for this company is 1.09x above the industry average, indicating a premium valuation associated with the stock.

• The elevated Price to Book ratio of 60.52 relative to the industry average by 11.21x suggests company might be overvalued based on its book value.

• The Price to Sales ratio of 8.98, which is 4.83x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.

• The Return on Equity (ROE) of 23.83% is 17.45% above the industry average, highlighting efficient use of equity to generate profits.

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

• Compared to its industry, the company has higher gross profit of $43.88 Billion, which indicates 61.8x above the industry average, indicating stronger profitability and higher earnings from its core operations.

• With a revenue growth of 6.07%, which is much lower than the industry average of 167.76%, the company is experiencing a notable slowdown in sales expansion.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio provides insights into the proportion of debt a company has in relation to its equity and asset value.

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.

When comparing Apple with its top 4 peers based on the Debt-to-Equity ratio, the following insights can be observed:

• 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, the PE, PB, and PS ratios are all high compared to its peers in the Technology Hardware, Storage & Peripherals industry, indicating that the stock may be overvalued based on these metrics. On the other hand, Apple's high ROE, EBITDA, gross profit, and low revenue growth suggest that the company is efficiently utilizing its resources and generating strong profits, despite slower revenue growth compared to industry peers.

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