Apple Inc. (AAPL) stock analysis

P/E above its 5-year median

Apple's P/E of 40.8 is above its own 5-year median of 31.4.

P/E above the industry

Apple's P/E of 40.8 is above the Computer and Office Equipment median of 26.0.

EV/EBITDA above its 5-year median

Apple's EV/EBITDA of 31.0 is above its 5-year median of 23.9.

P/B above the industry

Apple's price-to-book of 48.27 is above the Computer and Office Equipment median of 3.71.

Trading above fair value

The share price of $355.63 is above our fair value estimate of $250.64.

Margin of safety under 20%

The price is 41.9% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew 1.8% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew 6.9% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 29.9% over the last twelve months, against a 5-year average of 14.3% a year.

Growing faster than the industry

Revenue grew 14.2% over the last twelve months; the Computer and Office Equipment median is 11.2%.

Company guidance

No outlook found in earnings releases from the last twelve months.

Gross margin improving

Gross margin was 48.7% over the last twelve months, against 46.7% a year earlier.

Return on equity over 15%

Return on equity was 149% over the last twelve months and averaged 165% over five years.

Return on capital over 10%

Return on invested capital was 106%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

Apple's return on equity of 149% is above the Computer and Office Equipment median of 7.5%.

Earnings grew over 5 years

Net income grew 14.3% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 27.6% over the last twelve months, against a 5-year average of 25.5%.

Net margin above the industry

Apple's net margin of 27.6% is above the Computer and Office Equipment median of 3.8%.

High debt

Debt is 78.4% of shareholders' equity, above the 40% we consider low.

Debt falling against equity

Debt to equity fell from 172% five years ago to 78.4%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 174% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets cover short-term debts

Current assets are 1.00 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 13.89; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Apple paid dividends worth 0.3% of the share price over the last twelve months.

Yield below Treasuries

The 0.3% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Apple yields 0.3%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 12.1% of net income.

Covered by free cash flow

Dividends take 11.4% of free cash flow.