Competitor Analysis: Evaluating Apple And Competitors In Technology Hardware, Storage & Peripherals Industry

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 makes up a majority of the firm sales, and Apple's other products like 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, like streaming video, subscription bundles, and augmented reality. The firm designs its own software and semiconductors while working with subcontractors like Foxconn and TSMC to build its products and chips. Slightly less than half of Apple's sales come directly through its flagship stores, with a majority of sales coming indirectly through partnerships and distribution.

After thoroughly examining Apple, the following trends can be inferred:

• At 36.27, the stock's Price to Earnings ratio is 0.72x less than the industry average, suggesting favorable growth potential.

• The elevated Price to Book ratio of 53.88 relative to the industry average by 5.46x suggests company might be overvalued based on its book value.

• The Price to Sales ratio of 8.83, which is 2.66x the industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.

• The Return on Equity (ROE) of 35.34% is 29.55% above the industry average, highlighting efficient use of equity to generate profits.

• The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $31.03 Billion is 88.66x above the industry average, highlighting stronger profitability and robust cash flow generation.

• With higher gross profit of $43.72 Billion, which indicates 47.52x above the industry average, the company demonstrates stronger profitability and higher earnings from its core operations.

• The company's revenue growth of 9.63% exceeds the industry average of 6.78%, indicating strong sales performance and market outperformance.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio is a key indicator of a company's financial health and its reliance on debt financing.

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.

When comparing Apple with its top 4 peers based on the Debt-to-Equity ratio, the following insights can be observed:

• In the context of the debt-to-equity ratio, Apple holds a middle position among its top 4 peers.

• This indicates a moderate level of debt relative to its equity with a debt-to-equity ratio of 1.54, which implies a relatively balanced financial structure with a reasonable debt-equity mix.

Key Takeaways

For Apple in the Technology Hardware, Storage & Peripherals industry, the PE, PB, and PS ratios indicate that the stock is relatively undervalued compared to its peers. However, the high ROE, EBITDA, gross profit, and revenue growth suggest that Apple is performing exceptionally well in terms of profitability and growth within the industry sector.

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