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 accounts for the majority of the firm's sales, and Apple's other products, such as the 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, such as streaming video, subscription bundles, and augmented reality. The firm designs its own software and semiconductors and works with subcontractors such as Foxconn and TSMC to build its products and chips. Slightly less than half of Apple's sales come directly through its flagship stores, with the majority 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 39.04 46.21 10.78 27.84% $39.02 $54.77 16.36%
SanDisk Corp 21.82 14.78 12.32 46.78% $7.89 $7.58 371.59%
Seagate Technology Holdings PLC 55.74 81.31 14.55 79.34% $1.64 $1.9 48.49%
Western Digital Corp 14.61 16.61 11.66 34.3% $3.36 $2.03 43.84%
Hewlett Packard Enterprise Co 36.60 3.55 2.40 5.83% $2.33 $4.9 33.68%
Everpure Inc 206.26 32.56 12.25 4.97% $0.11 $0.81 37.73%
NetApp Inc 32.63 30.36 6.26 26.35% $0.55 $1.42 29.89%
Super Micro Computer Inc 13.12 2.74 0.76 12.83% $1.57 $1.94 93.16%
Logitech International SA 18.64 6.18 3.04 10.33% $0.28 $0.61 6.93%
Diebold Nixdorf Inc 20.87 2.21 0.59 1.56% $0.09 $0.24 1.7%
Corsair Gaming Inc 42.23 2.13 0.97 1.04% $0.02 $0.1 -1.8%
Immersion Corp 21 0.79 0.14 1.93% $0.01 $0.06 0.81%
Average 43.96 17.57 5.9 20.48% $1.62 $1.96 60.55%

Upon analyzing Apple, the following trends can be observed:

  • The stock's Price to Earnings ratio of 39.04 is lower than the industry average by 0.89x, suggesting potential value in the eyes of market participants.

  • With a Price to Book ratio of 46.21, which is 2.63x 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 10.78, which is 1.83x 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 27.84%, which is 7.36% 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 $39.02 Billion, which is 24.09x above the industry average, the company demonstrates stronger profitability and robust cash flow generation.

  • The company has higher gross profit of $54.77 Billion, which indicates 27.94x above the industry average, indicating stronger profitability and higher earnings from its core operations.

  • The company's revenue growth of 16.36% is significantly below the industry average of 60.55%. This suggests a potential struggle in generating increased sales volume.

Debt To Equity Ratio

debt to equity

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.

By considering the Debt-to-Equity ratio, Apple can be compared to its top 4 peers, leading to the following observations:

  • When comparing the debt-to-equity ratio, Apple is in a stronger financial position compared to its top 4 peers.

  • The company has a lower level of debt relative to its equity, indicating a more favorable balance between the two with a lower debt-to-equity ratio of 0.78.

Key Takeaways

For Apple in the Technology Hardware, Storage & Peripherals industry, the PE ratio is low compared to peers, indicating potential undervaluation. However, the PB and PS ratios are high, suggesting overvaluation relative to industry standards. In terms of ROE, EBITDA, and gross profit, Apple demonstrates strong performance with high figures, reflecting efficient operations and profitability. Despite this, the low revenue growth rate may raise concerns about the company's ability to sustain long-term growth compared to industry peers.

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