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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Apple Inc. (XNAS:AAPL) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
AAPL
Name:
APPLE INC. (XNAS:AAPL)
Sector:
44.16B
Industry:
Consumer Electronics
CEO:
Mr. Timothy Cook
Total Employees:
154,000
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is -31.63% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF APPLE INC.(AAPL) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND CONSUMER ELECTRONICS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
155.81
One Month Price Target:
$156.89
Six Month Price Target :
$162.31
Likely Price in One Year's Time:
Ticker:
$168.82
Likely Trading Range Today Under (Normal Volatility)
$155.44
Price Upper limit ($) :
$156.64
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$148.73
This week:
$139.98
This month :
$124.15
Other Primary facts
Market Cap:
2483.41B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
16.07B
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
11.98%
-12.86%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$188.60
$173.17
$123.02
$138.45
Medium risk (<10%) entry points
Buy Call
Sell Call
$168.15
Buy Put:
Sell Put:
$164.86
$143.43
$146.76
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
AAPL
Sharpe Ratio:
6.07%
Comparison:
AAPL, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 224.54% higher than the industry
& ratio is 166.29% higher than the market/S&P 500 average
Average Returns/Yield of
AAPL
Daily returns:
0.15%
Weekly returns:
0.74%
Monthly returns:
2.95%
Yearly returns:
16.65%
Comparison of returns:
Average annual returns/yield (last 3 years) is 112.63% above industry average
Classification:
AAPL, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.29
Statistical test of Returns:
AAPL has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.28%
Weekly Volatility:
5.11%
Monthly Volatility:
10.21%
Yearly Volatility:
35.38%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.92%
Volatility in last five trading days has been -59.93% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.54%
Weekly VaR:
-10.16%
Monthly VaR:
-20.32%
How Much Can the price of
AAPL
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-16%
Worst case (decline):
-70.38%
This translates to price declining to:
$130.46
This translates to price declining to:
$46.15
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
AAPL is a 43.40% riskier investment compared to the market/S&P 500 & is 22.85% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -31.90% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
AAPL
Beta in relation to market/S&P 500--1.24
Expected beta in 1 year's time:
0.951
Expected beta in 3 year's time:
1.345
Unlevered (debt free) Beta:
0.547
Beta in relation to Nasdaq (XNAS):
1.082
Beta in relation to all global stocks::
0.757
Beta Comparison & Analysis
Beta of competitors/peers::
1.149
Beta is 8.10% higher than peers
Average Industry Beta:
1.372
Beta is -9.41% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
128.32%
Sustainable growth rate is 103.28% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.237
Alpha is 478.76% above industry average alpha yield
Alpha is 1511% higher than market/& is unsustainably high
Analysis of Cost of Capital of
AAPL
Equity cost of capital:
0.117
Equity cost of capital is -7.05% below industry mean WACC
Unlevered (without debt) cost of capital:
5.14%
Before-tax cost of debt:
2.22%
After-tax cost of debt:
1.75%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.75%
WACC is -0.34% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$24.02
Revenue growth rate per share of (3Y):
34.81
Annual revenue growth rate is 942.28% above the industry average
EPS:
$6.15
Expected Annual growth rate of EPS (3Y):
26.24%
Expected future EPS growth rate is 28.90% higher than the Consumer Electronics industry
Free cash flow (FCF) per share:
$6.35
Balance sheet equity growth per share: 25.22%
Equity growth rate per share is 300.00% higher than the industry
Debt per share
$6.63
EBITDA per share
$8.27
Valuation Analysis Today of
AAPL
P/E Ratio:
25.75
P/E Ratio of Competitors/Peers:
28.35
P/E ratio is -9.18% lower than main peers & is 57.87% higher than the industry
Stock price/value with industry average P/E ratio: $100.30
AAPL is 55.35% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $12.94
Present value of the expected future dividends only: $4.85
P/S (Price to Sales ratio):
6.49
Price to sales ratio is 138.70% above the industry mean
P/B (Price to book value ratio):
34.81
Price to free cash flow: 24.53
-
Net income growth rate (3Y):
88.76%
Net income growth rate is -134.84% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 3.66%
Dividend yeild: 0.57%
Previous Dividend: $0.23
Previous adjusted dividend: $0.23
Previous Dividend: $0.89
Expected next dividend best case: $0.47
Expected next dividend worst case: -$0.01
Average dividend payment (long-term): $0.43
Average dividend increase/decrease (growth rate) % per period: -5.66%
Expected next dividend payment date: 08/10/2022
Expected next dividend record date: 08/08/2022
Expected next dividend declaration date: 27/07/2022
Previous dividend payment date: 05/12/2022
Previous dividend record date: 05/09/2022
Previous dividend declaration date: 28/04/2022
Dividend History:
2022-05-06--$0.23
2021-11-05--$0.22
2021-05-07--$0.22
2022-02-04--$0.22
2021-08-06--$0.22
2021-02-05--$0.21
Dividend growth rate is -435.65% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
148.24%
Net debt to equity ratio:
119.11%
Debt to assets ratio:
27.97%
Net debt to assets ratio:
22.48%
Debt-to-asset ratio is -50.32% below industry average
Ability to repay debt:
Interest coverage ratio:
48.85
Interest coverage ratio is 83.50% more than industry average
Looking forward:
Debt growth rate:
10.92%
Annual debt growth is -51% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.819
Statistical significance of correlation:
AAPL has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.532
Stock price is 53.87% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.532
Correlation of price movement with Nasdaq (^IXIC):
0.001
Covariance of price movement with the market:
0.001
Kurtosis
4.564
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.006
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
AAPL
Gross Profit Margin Ratio:
173%
Operating Profit Margin Ratio:
30.93%
Operating profit margin is 74.09% higher than the industry
Net Profit Margin Ratio:
173%
Effective Tax Rate:
14.34%
Effective tax rate is -28.09% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
141.71%
Return on equity (ROE) is 106.88% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
26.74%
Return on assets (ROA) is 49.84% higher than the industry
Financial Leverage:
1.4x
Current Ratio:
1.04
Current ratio is -33.96% below industry average
Cash Conversion Cycle (days):
-60.5
Cash conversion cycle is -155.80% below industry average
The remaining useful life of property plant & equipment is: 0.7 years
Stock based compensation to net income ratio:
2.22%
In-depth Efficiency Analysis
Revenue generated per employee:
2.5M
Each employee generates 87% more revenue than industry average revenue per employee
EBITDA generated per employee:
863.5K
Each employee generates 201% more EBITDA than industry average revenue per employee
Profit generated per employee:
661.9K
Each employee generates 110% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
286.8K
Each employee generates 284% more free cash flow than industry average revenue per employee
Assets/Capital per employee
1.5M
Each employee generates 284% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 16.86%
Growth rate in R&D investment/expenditure is 167.47% higher than the industry
Competitors/Peer firms of
AAPL
MICROSOFT CORPORATION (XNAS:MSFT)
NVIDIA CORPORATION (XNAS:NVDA)
ASML Holding NV (XNAS:ASML)
Broadcom Inc. (XNAS:AVGO)
ADOBE INC. (XNAS:ADBE)
INTEL CORPORATION (XNAS:INTC)
QUALCOMM INCORPORATED (XNAS:QCOM)
TEXAS INSTRUMENTS INCORPORATED (XNAS:TXN)
INTUIT INC. (XNAS:INTU)
Current Analyst Ratings
Strong buy�46%
Buy�88%
Hold�25%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/26/22
Revenue:
386.02B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
218.79B
167.23B
24.18B
-
23.67B
-
-
47.85B
2.03B
2.72B
11.26B
132.97B
119.38B
101.94B
119.00B
17.06B
101.94B
Statement of Cash Flow
Date:
Period:
2.70B
Differed Income Tax :
682.00M
Stock Based Compensation :
2.27B
Change in Working Capital :
6.53B
Accounts Receivables:
- 3934000.00K
Other Working Capital:
462.00M
Other Non-Cash Items:
167.00M
Net Cash Provided by Operating Activities:
46.97B
Investments in PP&E:
- 2803000.00K
Net Acquisitions:
-
Purchases of Investments:
- 34913000.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
12/25/21
2022
Q1
37.12B
26.79B
63.91B
65.25B
5.88B
18.11B
153.15B
39.25B
-
-
138.68B
-
50.11B
228.04B
-
381.19B
74.36B
16.17B
41.24B
7.88B
49.17B
147.57B
106.63B
55.06B
161.69B
-
309.26B
58.42B
14.44B
- 927000.0K
-
December 25, 2021 at 12:00:00 AM
266.64B
71.93B
381.19B
165.48B
122.80B
85.7B
21.98B
- 374000.00K
- 16106000.00K
-
-
- 20478000.00K
- 3732000.00K
- 3949000.00K
- 28159000.00K
-
2.70B
38.63B
35.93B
46.97B
- 2803000.00K
44.16B
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
AAPL
2023
2024
2025
2026
2027
$210.50
$228.08
$247.12
$267.75
$290.11