In the fast-paced and highly competitive business world of today, conducting thorough company analysis is essential for investors and industry observers. In this article, we will conduct an extensive industry comparison, evaluating Apple (NASDAQ:AAPL) in relation to its major competitors in the Technology Hardware, Storage & Peripherals industry. Through a detailed examination of key financial metrics, market standing, and growth prospects, our objective is to provide valuable insights and illuminate company's performance in 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 38.27 45.29 10.56 27.84% $39.02 $54.77 16.36%
SanDisk Corp 23.32 16 13.17 46.78% $7.89 $7.58 371.59%
Seagate Technology Holdings PLC 61.08 89.09 15.94 79.34% $1.64 $1.9 48.49%
Western Digital Corp 15.43 16.89 12.31 34.3% $3.36 $2.03 43.84%
Hewlett Packard Enterprise Co 35.74 3.47 2.34 5.83% $2.33 $4.9 33.68%
Everpure Inc 191.97 30.31 11.40 4.97% $0.11 $0.81 37.73%
NetApp Inc 31.96 29.73 6.13 26.35% $0.55 $1.42 29.89%
Super Micro Computer Inc 13.40 2.80 0.78 12.83% $1.57 $1.94 93.16%
Logitech International SA 19.15 6.35 3.12 10.33% $0.28 $0.61 6.93%
Diebold Nixdorf Inc 21.12 2.23 0.60 1.56% $0.09 $0.24 1.7%
Corsair Gaming Inc 44.47 2.24 1.02 1.04% $0.02 $0.1 -1.8%
Average 45.76 19.91 6.68 22.33% $1.78 $2.15 66.52%

By analyzing Apple, we can infer the following trends:

  • The Price to Earnings ratio of 38.27 is 0.84x lower than the industry average, indicating potential undervaluation for the stock.

  • It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 45.29 which exceeds the industry average by 2.27x.

  • The stock's relatively high Price to Sales ratio of 10.56, surpassing the industry average by 1.58x, may indicate an aspect of overvaluation in terms of sales performance.

  • The company has a higher Return on Equity (ROE) of 27.84%, which is 5.51% 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 21.92x 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 25.47x 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 66.52%, which indicates a challenging sales environment.

Debt To Equity Ratio

debt to equity

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.

In terms of the Debt-to-Equity ratio, Apple stands in comparison with its top 4 peers, leading to the following comparisons:

  • 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 and PS ratios suggest that the market values Apple's assets and sales highly. Apple's high ROE, EBITDA, and gross profit reflect strong profitability and operational efficiency. However, the low revenue growth may indicate challenges in expanding market share compared to industry peers.

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