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

In today's rapidly changing and fiercely competitive business landscape, it is vital for investors and industry enthusiasts to carefully evaluate companies. In this article, we will perform a comprehensive industry comparison, evaluating Apple AAPL against its key competitors in the Technology Hardware, Storage & Peripherals industry. By analyzing important financial metrics, market position, and growth prospects, we aim 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 an analysis of Apple, we can infer the following trends:

• The stock's Price to Earnings ratio of 39.91 is lower than the industry average by 0.99x, suggesting potential value in the eyes of market participants.

• It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 64.4 which exceeds the industry average by 10.52x.

• The Price to Sales ratio of 9.56, which is 4.6x 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 16.46% above the industry average. This suggests efficient use of equity to generate profits and demonstrates profitability and growth potential.

• The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $32.5 Billion is 95.59x above the industry average, highlighting 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 is witnessing a substantial decline in revenue growth, with a rate of 6.07% compared to the industry average of 167.6%, which indicates a challenging sales environment.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio measures the financial leverage of a company by evaluating its debt relative to its equity.

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 can be assessed by comparing it to its top 4 peers, resulting in the following observations:

• Apple holds a middle position in terms of the debt-to-equity ratio compared to its top 4 peers.

• This indicates a balanced financial structure with a moderate level of debt and an appropriate reliance on equity financing with a debt-to-equity ratio of 1.87.

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.