In today's rapidly changing and highly competitive business world, it is vital for investors and industry enthusiasts to carefully assess companies. In this article, we will perform a comprehensive industry comparison, evaluating Apple (NASDAQ: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 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 35.48 41.99 9.79 27.84% $39.02 $54.77 16.36%
SanDisk Corp 21.64 14.85 12.22 46.78% $7.89 $7.58 371.59%
Seagate Technology Holdings PLC 3363.31 88.90 877.88 79.34% $1.64 $1.9 48.49%
Western Digital Corp 17.07 18.69 13.62 34.3% $3.36 $2.03 43.84%
Hewlett Packard Enterprise Co 49.95 2.80 1.85 2.38% $1.7 $3.9 40.0%
NetApp Inc 30.28 27.93 5.58 32.2% $0.59 $1.36 12.47%
Everpure Inc 164.47 25.02 9.57 1.67% $0.07 $0.72 35.25%
Super Micro Computer Inc 11.42 2.35 0.66 13.07% $0.7 $1.02 8.56%
Logitech International SA 17.62 5.85 2.87 10.33% $0.28 $0.61 6.93%
Diebold Nixdorf Inc 23.16 2.45 0.65 1.56% $0.09 $0.24 1.7%
Corsair Gaming Inc 35.26 1.78 0.81 1.04% $0.02 $0.1 -1.8%
Immersion Corp 53.79 0.84 0.14 1.26% $0.02 $1.36 -5.22%
Average 344.36 17.41 84.17 20.36% $1.49 $1.89 51.07%

By conducting an in-depth analysis of Apple, we can identify the following trends:

  • The Price to Earnings ratio of 35.48 is 0.1x lower than the industry average, indicating potential undervaluation for the stock.

  • With a Price to Book ratio of 41.99, which is 2.41x 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.

  • Based on its sales performance, the stock could be deemed undervalued with a Price to Sales ratio of 9.79, which is 0.12x the industry average.

  • With a Return on Equity (ROE) of 27.84% that is 7.48% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.

  • With higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $39.02 Billion, which is 26.19x above the industry average, the company demonstrates stronger profitability and robust cash flow generation.

  • Compared to its industry, the company has higher gross profit of $54.77 Billion, which indicates 28.98x above the industry average, indicating stronger profitability and higher earnings from its core operations.

  • The company is witnessing a substantial decline in revenue growth, with a rate of 16.36% compared to the industry average of 51.07%, which indicates a challenging sales environment.

Debt To Equity Ratio

debt to equity

The debt-to-equity (D/E) ratio assesses the extent to which a company relies on borrowed funds compared 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:

  • Among its top 4 peers, Apple has a stronger financial position with a lower debt-to-equity ratio of 0.78.

  • This indicates that the company relies less on debt financing and maintains a more favorable balance between debt and equity, which can be viewed positively by investors.

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 raise concerns about future performance compared to industry peers.

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