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 (NASDAQ: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 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 35.64 40.60 9.68 30.39% $39.32 $54.78 16.6%
SanDisk Corp 69.45 21.84 23.39 30.14% $4.15 $4.66 251.03%
Seagate Technology Holdings PLC 86.83 189.10 18.72 96.27% $1.0 $1.45 44.07%
Western Digital Corp 35.81 21.31 19.12 37.73% $3.49 $1.68 45.47%
Hewlett Packard Enterprise Co 41.07 2.30 1.52 2.38% $1.7 $3.9 40.0%
NetApp Inc 24.63 22.68 4.54 32.2% $0.59 $1.36 12.47%
Everpure Inc 116.88 17.78 6.80 1.67% $0.07 $0.72 35.25%
IonQ Inc 131.79 3.86 86.79 17.93% $-0.23 $0.02 754.72%
Super Micro Computer Inc 14.55 2.36 0.55 6.64% $0.7 $1.02 122.68%
Logitech International SA 19.71 6.14 2.90 6.31% $0.16 $0.48 7.44%
Diebold Nixdorf Inc 28.73 2.82 0.79 0.47% $0.07 $0.21 6.03%
Corsair Gaming Inc 105.06 1.56 0.69 1.85% $0.03 $0.12 -4.12%
Turtle Beach Corp 643 2.28 0.87 -12.65% $-0.01 $0.01 -34.0%
Average 109.79 24.5 13.89 18.41% $0.98 $1.3 106.75%

By closely examining Apple, we can identify the following trends:

  • At 35.64, the stock's Price to Earnings ratio is 0.32x less than the industry average, suggesting favorable growth potential.

  • It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 40.6 which exceeds the industry average by 1.66x.

  • Based on its sales performance, the stock could be deemed undervalued with a Price to Sales ratio of 9.68, which is 0.7x the industry average.

  • With a Return on Equity (ROE) of 30.39% that is 11.98% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.

  • The company has higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $39.32 Billion, which is 40.12x above the industry average, indicating stronger profitability and robust cash flow generation.

  • The gross profit of $54.78 Billion is 42.14x above that of its industry, highlighting stronger profitability and higher earnings from its core operations.

  • With a revenue growth of 16.6%, which is much lower than the industry average of 106.75%, the company is experiencing a notable slowdown in sales expansion.

Debt To Equity Ratio

debt to equity

The debt-to-equity (D/E) ratio is a financial metric that helps determine the level of financial risk associated with a company's capital structure.

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 is in a relatively stronger financial position compared to its top 4 peers, as evidenced by its lower debt-to-equity ratio of 0.8.

  • This implies that the company relies less on debt financing and has a more favorable balance between debt and equity.

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 ratio suggests the market values Apple's assets highly. With a low PS ratio, Apple's sales are relatively inexpensive. Apple's high ROE, EBITDA, and gross profit reflect strong profitability. However, the low revenue growth may indicate challenges in expanding market share.

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