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Apple (AAPL)
NASDAQ:AAPL
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Apple
(NASDAQ:AAPL)76Outperform
Positive Factors
Product Performance
The iPhone 16e delivers 40% faster performance relative to 2022’s iPhone SE (3rd-gen).
US Investments
Apple announced $500 billion in investments in the US, including a new advanced manufacturing facility and expanded data center capacity.
Negative Factors
Premium Valuation
Analyst maintains a hold recommendation based on premium valuation.
Apple (AAPL) vs. S&P 500 (SPY)
Market Cap
$3.54T
Dividend Yield0.53%
Average Volume (3M)53.74M
Price to Earnings (P/E)37.5
Beta (1Y)0.90
Revenue Growth2.61%
EPS Growth-2.14%
CountryUS
Employees164,000
SectorTechnology
Sector Strength48
IndustryHardware & Equipment
Share Statistics
EPS (TTM)6.29
Shares Outstanding15,022,073,000
10 Day Avg. Volume45,953,393
30 Day Avg. Volume53,743,075
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)9.04
Price to Cash Flow (P/CF)29.90
P/FCF Ratio29.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$250.95Price Target Upside6.37% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering33
Apple Business Overview & Revenue Model
Company DescriptionApple Inc. (AAPL) is a leading multinational technology company headquartered in Cupertino, California. The company designs, manufactures, and markets a wide array of consumer electronics, software, and services. Apple's core products include the iPhone, iPad, Mac computers, Apple Watch, and Apple TV. Additionally, Apple provides a range of services such as the App Store, Apple Music, iCloud, and Apple Pay, creating a comprehensive ecosystem for its users.
How the Company Makes MoneyApple Inc. generates revenue through a combination of product sales and services. The majority of its income comes from hardware sales, particularly the iPhone, which consistently contributes the largest portion of its total revenue. Other significant hardware sources include the Mac, iPad, and wearables like the Apple Watch. Beyond hardware, Apple has been increasingly focusing on its Services segment, which includes revenue from the App Store, Apple Music subscriptions, iCloud storage services, AppleCare, and Apple Pay. This diversification into services has provided a steady, recurring revenue stream that complements its hardware sales. Additionally, Apple's ecosystem strategy encourages consumer loyalty and cross-product usage, further driving sales and service revenue. Strategic partnerships, such as with telecommunications companies for iPhone distribution, also play a crucial role in expanding Apple's market reach and boosting sales.
Apple Financial Statement Overview
Summary
Apple demonstrates strong profitability with a robust gross margin and net profit margin. The balance sheet is solid with low leverage, and cash flow generation remains strong despite a decrease in free cash flow. Overall, Apple shows stable financial health and operational efficiency.Income Statement
Apple demonstrates strong profitability with a consistent Gross Profit Margin of around 46.5% in TTM, showcasing operational efficiency. The Net Profit Margin stands at 24.3% for TTM, highlighting effective cost management. Revenue growth has been modest, with a TTM increase over the previous annual period. EBIT and EBITDA margins remain robust, indicating healthy operating earnings before interest and taxes.85
Very Positive
Balance Sheet
Apple's balance sheet is solid with a low Debt-to-Equity Ratio of 0.03 in TTM, indicating conservative leverage. The Return on Equity is strong at 144.0%, reflecting efficient equity utilization. The Equity Ratio is 19.4%, suggesting a moderate reliance on equity financing. However, fluctuating equity levels could pose potential risks.78
Positive
Cash Flow
Apple shows a healthy cash flow situation with a strong Free Cash Flow of $101.2 billion in TTM. The Operating Cash Flow to Net Income Ratio is 1.13, indicating efficient cash conversion. Despite a decrease in Free Cash Flow compared to the previous period, the company maintains solid cash generation capabilities.80
Positive
| Breakdown | |||||
| TTM | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 395.76B | 391.04B | 383.29B | 394.33B | 365.82B | 274.51B | Gross Profit |
| 184.10B | 180.68B | 169.15B | 170.78B | 152.84B | 104.96B | EBIT |
| 125.67B | 123.22B | 114.30B | 119.44B | 108.95B | 66.29B | EBITDA |
| 134.27B | 134.66B | 125.82B | 130.54B | 120.23B | 77.34B | Net Income Common Stockholders |
| 96.15B | 93.74B | 97.00B | 99.80B | 94.68B | 57.41B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 65.17B | 65.17B | 61.55B | 48.30B | 62.64B | 90.94B | Total Assets |
| 364.98B | 364.98B | 352.58B | 352.75B | 351.00B | 323.89B | Total Debt |
| 106.63B | 106.63B | 111.09B | 132.48B | 136.52B | 122.28B | Net Debt |
| 76.69B | 76.69B | 81.12B | 108.83B | 101.58B | 84.26B | Total Liabilities |
| 308.03B | 308.03B | 290.44B | 302.08B | 287.91B | 258.55B | Stockholders Equity |
| 56.95B | 56.95B | 62.15B | 50.67B | 63.09B | 65.34B |
| Cash Flow | Free Cash Flow | ||||
| 98.30B | 108.81B | 99.58B | 111.44B | 92.95B | 73.36B | Operating Cash Flow |
| 108.29B | 118.25B | 110.54B | 122.15B | 104.04B | 80.67B | Investing Cash Flow |
| 10.80B | 2.94B | 3.71B | -22.35B | -14.54B | -4.29B | Financing Cash Flow |
| -130.77B | -121.98B | -108.49B | -110.75B | -93.35B | -86.82B |
Apple Technical Analysis
Negative
235.93
Price Trends
239.43
Negative
236.26
Negative
225.93
Positive
Market Momentum
1.02
Positive
45.89
Neutral
42.42
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AAPL, the sentiment is Negative. The current price of 235.93 is below the 20-day moving average (MA) of 238.83, below the 50-day MA of 239.43, and above the 200-day MA of 225.93, indicating a neutral trend. The MACD of 1.02 indicates Positive momentum. The RSI at 45.89 is Neutral, neither overbought nor oversold. The STOCH value of 42.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AAPL.
Apple Risk Analysis
Apple disclosed 28 risk factors in its most recent earnings report. Apple reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Apple Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $2.16T | 36.91 | 20.72% | ― | 10.99% | 91.61% | |
81 Outperform | $2.89T | 31.30 | 30.64% | 0.80% | 15.04% | 12.38% | |
76 Outperform | $3.54T | 37.51 | 144.03% | 0.53% | 2.61% | -2.14% | |
75 Outperform | $2.83T | 39.48 | 91.87% | 0.03% | 114.20% | 146.26% | |
74 Outperform | $2.09T | 21.17 | 30.80% | 0.35% | 13.89% | 38.99% | |
59 Neutral | $22.39B | 11.53 | -18.05% | 2.31% | 5.00% | -25.89% | |
54 Neutral | $92.36B | ― | -18.89% | 2.11% | -2.08% | -1212.72% |
* Technology Sector Average
Performance Comparison
AAPL
Apple
235.93
66.61
39.34%
AMZN
Amazon
203.80
29.68
17.05%
GOOGL
Alphabet Class A
170.92
38.73
29.30%
INTC
Intel
21.33
-21.38
-50.06%
MSFT
Microsoft
388.61
-10.99
-2.75%
NVDA
Nvidia
115.99
30.05
34.97%
Apple Earnings Call Summary
Earnings Call Date: Jan 30, 2025 | % Change Since: -0.59% | Next Earnings Date: Apr 24, 2025
Earnings Call Sentiment Positive
The earnings call reflected a strong overall performance with record-breaking revenue and growth in services and emerging markets. However, challenges in China and a decline in wearables revenue presented some areas of concern.Highlights
Record-Breaking Revenue and Growth
Apple reported revenue of $124.3 billion for the December quarter, up 4% from a year ago, marking an all-time record. EPS also set an all-time record of $2.40, 10% higher year-over-year.
Strong Performance in Emerging Markets
Apple achieved all-time revenue records in emerging markets such as Latin America, the Middle East, and South Asia. India set a December quarter record with the iPhone as the top-selling model.
Services Revenue Surge
Services revenue reached an all-time record of $26.3 billion, up 14% year-over-year, with growth in every geographic segment and increased customer engagement.
Mac and iPad Growth
Mac revenue was $9 billion, up 16% year-over-year, while iPad revenue was $8.1 billion, up 15% year-over-year, driven by new product launches and strong customer interest.
Lowlights
Challenges in China
Greater China revenue decreased by 11% year-over-year, with over half of the decline driven by changes in channel inventory and competitive pressures.
Wearables Revenue Decline
Wearables, home, and accessories revenue was $11.7 billion, down 2% year-over-year, partly due to difficult comparisons with the prior year's launch of the Apple Watch Ultra 2.
Company Guidance
During the Apple Q1 Fiscal Year 2025 Earnings Conference Call, Apple reported a record revenue of $124.3 billion, a 4% increase from the previous year, with EPS reaching an all-time high of $2.40, up 10% year-over-year. The company set all-time revenue records in several regions, including the Americas, Europe, Japan, and the rest of Asia Pacific, and observed strong momentum in emerging markets such as Latin America and South Asia. Services revenue achieved an all-time high of $26.3 billion, growing 14% year-over-year. Apple also highlighted its installed base reaching over 2.35 billion active devices. Product-wise, iPhone revenue was $69.1 billion, Mac revenue rose by 16% to $9 billion, and iPad revenue increased by 15% to $8.1 billion. Despite a 2% year-over-year decline, wearables, home, and accessories revenue stood at $11.7 billion. The company maintained a robust gross margin of 46.9% and reported operating expenses of $15.4 billion. Looking ahead, Apple anticipates low to mid-single-digit revenue growth in the March quarter, with services revenue expected to grow in low-double digits, despite facing foreign exchange headwinds.Apple Corporate Events
Executive/Board Changes
Apple Appoints Kevan Parekh as New CFO
Neutral
Jan 3, 2025
Apple has appointed Kevan Parekh as its new Chief Financial Officer, effective January 1, 2025, succeeding Luca Maestri. Parekh, who joined Apple in 2013, has held several senior roles within the company and brings experience from previous positions at Thomson Reuters and General Motors. He will receive a salary of $1 million and is eligible for the Executive Cash Incentive Plan. Parekh has been awarded both performance-based and time-based restricted stock units, with vesting linked to Apple’s shareholder return performance relative to the S&P 500, as well as standard vesting schedules, indicating a strong incentive alignment with company performance.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.