Inquiry Into Apple’s Competitor Dynamics In Technology Hardware, Storage & Peripherals Industry – Apple (NASDAQ:AAPL)
In the dynamic and fiercely competitive business environment, conducting a thorough analysis of companies is crucial for investors and industry enthusiasts. In this article, we will perform an extensive industry comparison, evaluating Apple AAPL in relation to its major competitors in the Technology Hardware, Storage & Peripherals industry. By closely examining crucial financial metrics, market position, and growth prospects, we aim to offer 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 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.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| Apple Inc | 36.10 | 53.63 | 8.79 | 35.34% | $31.03 | $43.72 | 9.63% |
| Western Digital Corp | 23.63 | 6.87 | 3.97 | 5.21% | $0.51 | $1.07 | 29.99% |
| Hewlett Packard Enterprise Co | 29.69 | 1.36 | 1.02 | 1.14% | $1.11 | $2.67 | 18.5% |
| Pure Storage Inc | 212.34 | 21.69 | 8.85 | 3.68% | $0.09 | $0.6 | 12.73% |
| Super Micro Computer Inc | 27.35 | 4.33 | 1.31 | 3.08% | $0.26 | $0.54 | 7.51% |
| NetApp Inc | 22.36 | 25.87 | 3.96 | 23.13% | $0.38 | $1.1 | 1.17% |
| Logitech International SA | 26.57 | 7.50 | 3.65 | 6.77% | $0.18 | $0.48 | 5.47% |
| Turtle Beach Corp | 15.77 | 2.62 | 0.91 | -2.47% | $0.0 | $0.02 | -25.76% |
| Average | 51.1 | 10.03 | 3.38 | 5.79% | $0.36 | $0.93 | 7.09% |
By thoroughly analyzing Apple, we can discern the following trends:
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With a Price to Earnings ratio of 36.1, which is 0.71x less than the industry average, the stock shows potential for growth at a reasonable price, making it an interesting consideration for market participants.
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It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 53.63 which exceeds the industry average by 5.35x.
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With a relatively high Price to Sales ratio of 8.79, which is 2.6x the industry average, the stock might be considered overvalued based on sales performance.
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The Return on Equity (ROE) of 35.34% is 29.55% above the industry average, highlighting efficient use of equity to generate profits.
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Compared to its industry, the company has higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $31.03 Billion, which is 86.19x above the industry average, indicating stronger profitability and robust cash flow generation.
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With higher gross profit of $43.72 Billion, which indicates 47.01x above the industry average, the company demonstrates stronger profitability and higher earnings from its core operations.
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The company is experiencing remarkable revenue growth, with a rate of 9.63%, outperforming the industry average of 7.09%.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio measures the financial leverage of a company by evaluating its debt relative 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.
When evaluating Apple alongside its top 4 peers in terms of the Debt-to-Equity ratio, the following insights arise:
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When evaluating the debt-to-equity ratio, Apple is in the middle position among its top 4 peers.
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The company maintains a moderate level of debt relative to its equity with a debt-to-equity ratio of 1.54, suggesting a relatively balanced financial structure.
Key Takeaways
For Apple, the PE ratio is low compared to peers, indicating potential undervaluation. The high PB and PS ratios suggest the market values the company’s assets and sales highly. In terms of ROE, EBITDA, gross profit, and revenue growth, Apple outperforms its industry peers, reflecting strong financial performance and growth potential.
This article was generated by Benzinga’s automated content engine and reviewed by an editor.