Amidst today's fast-paced and highly competitive business environment, it is crucial for investors and industry enthusiasts to conduct comprehensive company evaluations. In this article, we will delve into an extensive industry comparison, evaluating Apple (NASDAQ:AAPL) in comparison to its major competitors within the Technology Hardware, Storage & Peripherals industry. By analyzing critical financial metrics, market position, and growth potential, our objective is to provide valuable insights for investors and offer a deeper understanding of 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 38.18 45.18 10.54 27.84% $39.02 $54.77 16.36%
SanDisk Corp 23.10 15.86 13.05 46.78% $7.89 $7.58 371.59%
Seagate Technology Holdings PLC 63.82 93.09 16.66 79.34% $1.64 $1.9 48.49%
Western Digital Corp 16.41 17.96 13.09 34.3% $3.36 $2.03 43.84%
Hewlett Packard Enterprise Co 35.24 3.42 2.31 5.83% $2.33 $4.9 33.68%
Everpure Inc 197.10 31.12 11.71 4.97% $0.11 $0.81 37.73%
NetApp Inc 31.61 29.40 6.06 26.35% $0.55 $1.42 29.89%
Super Micro Computer Inc 13.25 2.77 0.77 12.83% $1.57 $1.94 93.16%
Logitech International SA 18.60 6.17 3.03 10.33% $0.28 $0.61 6.93%
Diebold Nixdorf Inc 21.73 2.30 0.61 1.56% $0.09 $0.24 1.7%
Corsair Gaming Inc 43.65 2.20 1 1.04% $0.02 $0.1 -1.8%
Average 46.45 20.43 6.83 22.33% $1.78 $2.15 66.52%

Upon a comprehensive analysis of Apple, the following trends can be discerned:

  • The stock's Price to Earnings ratio of 38.18 is lower than the industry average by 0.82x, suggesting potential value in the eyes of market participants.

  • With a Price to Book ratio of 45.18, which is 2.21x 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 10.54, which is 1.54x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.

  • With a Return on Equity (ROE) of 27.84% that is 5.51% 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 $39.02 Billion, which is 21.92x above the industry average, indicating stronger profitability and robust cash flow generation.

  • Compared to its industry, 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.

  • With a revenue growth of 16.36%, which is much lower than the industry average of 66.52%, 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 light of the Debt-to-Equity ratio, a comparison between Apple and its top 4 peers reveals the following information:

  • In terms of the debt-to-equity ratio, Apple has a lower level of debt compared to its top 4 peers, indicating a stronger financial position.

  • This implies that the company relies less on debt financing and has a more favorable balance between debt and equity 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. The PB and PS ratios are high, suggesting overvaluation relative to industry standards. Apple's high ROE, EBITDA, and gross profit signify strong profitability, while the low revenue growth implies slower expansion compared to industry peers.

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