NasdaqGS:AAPL

Stock Analysis Report

Executive Summary

Apple Inc. designs, manufactures, and markets smartphones, personal computers, tablets, wearables, and accessories worldwide.

Rewards

PE ratio (26.6x) is below the Tech industry average (26.7x)

Earnings are forecast to grow 5.42% per year

Risk Analysis

Has a high level of debt

Highly volatile share price over past 3 months



Snowflake Analysis

Adequate balance sheet with questionable track record.


Similar Companies

Share Price & News

How has Apple's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: AAPL's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-0.1%

AAPL

-0.2%

US Tech

-1.3%

US Market


1 Year Return

101.8%

AAPL

92.9%

US Tech

22.0%

US Market

Return vs Industry: AAPL exceeded the US Tech industry which returned 96.6% over the past year.

Return vs Market: AAPL exceeded the US Market which returned 24.7% over the past year.


Shareholder returns

AAPLIndustryMarket
7 Day-0.1%-0.2%-1.3%
30 Day9.8%9.1%1.6%
90 Day29.1%27.1%8.9%
1 Year104.8%101.8%96.1%92.9%24.7%22.0%
3 Year173.2%161.0%152.2%134.0%49.4%39.7%
5 Year195.7%171.7%170.0%142.9%78.1%58.5%

Price Volatility Vs. Market

How volatile is Apple's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Apple undervalued compared to its fair value and its price relative to the market?

26.6x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: AAPL ($312.68) is trading above our estimate of fair value ($274.87)

Significantly Below Fair Value: AAPL is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: AAPL is good value based on its PE Ratio (26.6x) compared to the Tech industry average (26.7x).

PE vs Market: AAPL is poor value based on its PE Ratio (26.1x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: AAPL is poor value based on its PEG Ratio (4.8x)


Price to Book Ratio

PB vs Industry: AAPL is overvalued based on its PB Ratio (15.4x) compared to the US Tech industry average (1.9x).


Next Steps

Future Growth

How is Apple forecast to perform in the next 1 to 3 years based on estimates from 38 analysts?

5.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AAPL's forecast earnings growth (5.4% per year) is above the savings rate (1.7%).

Earnings vs Market: AAPL's earnings (5.4% per year) are forecast to grow slower than the US market (14.3% per year).

High Growth Earnings: AAPL's earnings are forecast to grow, but not significantly.

Revenue vs Market: AAPL's revenue (6.2% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: AAPL's revenue (6.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AAPL's Return on Equity is forecast to be very high in 3 years time (155.1%).


Next Steps

Past Performance

How has Apple performed over the past 5 years?

4.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: AAPL has high quality earnings.

Growing Profit Margin: AAPL's current net profit margins (21.2%) are lower than last year (22.4%).


Past Earnings Growth Analysis

Earnings Trend: AAPL's earnings have grown by 4.8% per year over the past 5 years.

Accelerating Growth: AAPL's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: AAPL had negative earnings growth (-7.1%) over the past year, making it difficult to compare to the Tech industry average (25.2%).


Return on Equity

High ROE: Whilst AAPL's Return on Equity (61.06%) is outstanding, this metric is skewed due to their high level of debt.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Apple's financial position?


Financial Position Analysis

Short Term Liabilities: AAPL's short term assets ($162.8B) exceed its short term liabilities ($105.7B).

Long Term Liabilities: AAPL's short term assets ($162.8B) exceed its long term liabilities ($142.3B).


Debt to Equity History and Analysis

Debt Level: AAPL's debt to equity ratio (119.4%) is considered high.

Reducing Debt: AAPL's debt to equity ratio has increased from 31.6% to 119.4% over the past 5 years.

Debt Coverage: AAPL's debt is well covered by operating cash flow (64.2%).

Interest Coverage: AAPL earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: AAPL has a low level of unsold assets or inventory.

Debt Coverage by Assets: AAPL's debt is covered by short term assets (assets are 1.5x debt).


Next Steps

Dividend

What is Apple's current dividend yield, its reliability and sustainability?

0.97%

Current Dividend Yield


Dividend Yield vs Market

company1.0%marketbottom25%1.4%markettop25%3.7%industryaverage1.1%forecastin3Years1.1%

Current dividend yield vs market & industry

Notable Dividend: AAPL's dividend (0.99%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: AAPL's dividend (0.99%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, AAPL has been paying a dividend for less than 10 years.

Growing Dividend: AAPL's dividend payments have increased, but the company has only paid a dividend for 8 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (25.1%), AAPL's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: AAPL's dividends in 3 years are forecast to be well covered by earnings (23.1% payout ratio).


Next Steps

Management

What is the CEO of Apple's salary, the management and board of directors tenure and is there insider trading?

3.3yrs

Average management tenure


CEO

Tim Cook (58yo)

8.4yrs

Tenure

US$11,555,466

Compensation

Mr. Timothy D. Cook, also known as Tim, has been the Chief Executive Officer of Apple Inc. since August 24, 2011. Mr. Cook served as the Chief Operating Officer of Apple Inc., from October 14, 2005 to Augu ...


CEO Compensation Analysis

Compensation vs Market: Tim's total compensation ($USD11.56M) is about average for companies of similar size in the US market ($USD10.76M).

Compensation vs Earnings: Tim's compensation has been consistent with company performance over the past year.


Management Age and Tenure

3.3yrs

Average Tenure

55yo

Average Age

Experienced Management: AAPL's management team is considered experienced (3.3 years average tenure).


Board Age and Tenure

8.4yrs

Average Tenure

69yo

Average Age

Experienced Board: AAPL's board of directors are considered experienced (8.4 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$951,63505 Aug 19
Chris Kondo
EntityIndividual
Role
Chief Accounting Officer
Senior Director of Corporate Accounting
Shares4,376
Max PriceUS$217.47

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Tim Cook (58yo)

    CEO & Director

    • Tenure: 8.4yrs
    • Compensation: US$11.56m
  • Phil Schiller (59yo)

    Senior VP of Worldwide Marketing & Interim VP of Communications

    • Tenure: 0.3yrs
    • Compensation: US$6.78m
  • Kate Adams (55yo)

    Senior VP

    • Tenure: 2.1yrs
    • Compensation: US$25.23m
  • Luca Maestri (55yo)

    CFO & Senior VP

    • Tenure: 5.7yrs
    • Compensation: US$25.21m
  • Jeff Williams (55yo)

    Chief Operating Officer

    • Tenure: 4.1yrs
    • Compensation: US$25.21m
  • Chris Kondo

    Senior Director of Corporate Accounting

    • Tenure: 5.1yrs
  • Nancy Paxton

    Director-Investor Relations

    • Deirdre O’Brien (52yo)

      Senior Vice President of People & Retail

      • Tenure: 2.5yrs
      • Compensation: US$19.16m
    • James Wilson

      Chief Technology Officer

      • Tenure: 0.9yrs
    • Mary Demby

      Chief Information Officer


      Board Members

      • Tim Cook (58yo)

        CEO & Director

        • Tenure: 8.4yrs
        • Compensation: US$11.56m
      • Art Levinson (69yo)

        Independent Non-Executive Chairman of the Board

        • Tenure: 8.2yrs
        • Compensation: US$557.92k
      • Andrea Jung (61yo)

        Independent Director

        • Tenure: 12yrs
        • Compensation: US$385.39k
      • Ron Sugar (70yo)

        Independent Director

        • Tenure: 9.2yrs
        • Compensation: US$400.88k
      • Al Gore (71yo)

        Independent Director

        • Tenure: 17yrs
        • Compensation: US$360.26k
      • James Bell (70yo)

        Independent Director

        • Tenure: 4.3yrs
        • Compensation: US$355.84k
      • Sue Wagner (58yo)

        Independent Director

        • Tenure: 5.5yrs
        • Compensation: US$354.92k

      Company Information

      Apple Inc.'s company bio, employee growth, exchange listings and data sources


      Key Information

      • Name: Apple Inc.
      • Ticker: AAPL
      • Exchange: NasdaqGS
      • Founded: 1977
      • Industry: Technology Hardware, Storage and Peripherals
      • Sector: Tech
      • Market Cap: US$1.395t
      • Shares outstanding: 4.38b
      • Website: https://www.apple.com

      Number of Employees


      Location

      • Apple Inc.
      • One Apple Park Way
      • Cupertino
      • California
      • 95014
      • United States

      Listings

      TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
      AAPLBVC (Bolsa de Valores de Colombia)YesCommon StockCOCOPDec 1980
      AAPLNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDDec 1980
      APCDB (Deutsche Boerse AG)YesCommon StockDEEURDec 1980
      0R2VLSE (London Stock Exchange)YesCommon StockGBUSDDec 1980
      AAPLSWX (SIX Swiss Exchange)YesCommon StockCHCHFDec 1980
      APCXTRA (XETRA Trading Platform)YesCommon StockDEEURDec 1980
      AAPLUKR (PFTS Ukraine Stock Exchange)YesCommon StockUAUAHDec 1980
      AAPL *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNDec 1980
      AAPLBVL (Bolsa de Valores de Lima)YesCommon StockPEUSDDec 1980
      AAPLSNSE (Santiago Stock Exchange)YesCommon StockCLUSDDec 1980
      AP-UETLX (Eurotlx)YesCommon StockITEURDec 1980
      AAPLWBAG (Wiener Boerse AG)YesCommon StockATEURDec 1980
      US_AAPLKAS (Kazakhstan Stock Exchange)YesCommon StockKZKZTDec 1980
      AAPL34BOVESPA (Bolsa de Valores de Sao Paulo)BDR REPR 1/10 COM NPVBRBRLMay 2011
      AAPLBASE (Buenos Aires Stock Exchange)CEDEAR(REPR 1/10 SHR) (ARS)ARARSAug 2012

      Biography

      Apple Inc. designs, manufactures, and markets smartphones, personal computers, tablets, wearables, and accessories worldwide. It also sells various related services. The company offers iPhone, a line of smartphones; Mac, a line of personal computers; iPad, a line of multi-purpose tablets; and wearables, home, and accessories comprising AirPods, Apple TV, Apple Watch, Beats products, HomePod, iPod touch, and other Apple-branded and third-party accessories. It also provides digital content stores and streaming services; AppleCare support services; and iCloud, a cloud service, which stores music, photos, contacts, calendars, mail, documents, and others. In addition, the company offers various service, such as Apple Arcade, a game subscription service; Apple Card, a co-branded credit card; Apple News+, a subscription news and magazine service; and Apple Pay, a cashless payment service, as well as licenses its intellectual property, and provides other related services. The company serves consumers, and small and mid-sized businesses; and the education, enterprise, and government markets. It sells and delivers third-party applications for its products through the App Store, Mac App Store, and Watch App Store. The company also sells its products through its retail and online stores, and direct sales force; and third-party cellular network carriers, wholesalers, retailers, and resellers. Apple Inc. was founded in 1977 and is headquartered in Cupertino, California. 


      Company Analysis and Financial Data Status

      All financial data provided by Standard & Poor's Capital IQ.
      DataLast Updated (UTC time)
      Company Analysis2020/01/25 23:43
      End of Day Share Price2020/01/24 00:00
      Earnings2019/09/28
      Annual Earnings2019/09/28


      Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.