Apple (AAPL:NAS) Fundamental Valuation Report

Fundamental Valuation Report


Technology:Consumer Electronics

This Report was generated using the valuation tools available on For a free 30 day trial click here.

Close Price/Date
$203.77 (USD) 06/11/2018

Weighted Valuation
$225.98 (USD)

Overall Rating
Undervalued by 10.9%

Valuation Models Analyst Consensus: $240.00 (USD)
(in order of importance) Discounted Cash Flow: $205.46 (USD)
Comparables: $224.95 (USD)
Valuation Methods This company is:
Cash Flow: Fairly valued on a Cash Flow Valuation
Comparable Company: Undervalued on a Comparable Valuation
Asset: Overvalued on an Asset Valuation

Company Overview (AAPL:NAS USD)

Price 203.77
Range 201.69 – 204.72
52 week 155.15 – 232.07
Open 201.92
Vol / Avg. 31.52M/39.48M
Mkt cap 956.62B
P/E 17.11
Div/yield 2.72/0.01
EPS 11.91
Shares 4.75B
Beta 1.25

Company Description

Apple Inc designs a wide variety of consumer electronic devices, including smartphones (iPhone), tablets (iPad), PCs (Mac), smartwatches (Watch), and TV boxes (Apple TV), among others. The iPhone makes up the majority of Apple’s total revenue. In addition, Apple offers its customers a variety of services such as Apple Music, iCloud, AppleCare and Apple Pay, among others. Apple’s products run internally developed software and semiconductors, and the firm is well known for its integration of hardware, software and services. Apple’s products are distributed online as well as through company-owned stores and third-party retailers. The company generates about 40% of its revenue from the Americas, with the remainder earned internationally.

Valuation Details

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for AAPL:NAS

Using a discounted cash flow model we generated an intrinsic value of $205.46 (USD) for AAPL:NAS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

AAPL:NAS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $205.46 1% 5% 1% 5%
WACC (or Ke) 9.48 $246.56 $175.35
Terminal Growth Rate 3.00 $178.90 $241.70
Tax Rate 0.18 $218.08 $192.84
Cash Flow 93,238,793,000 $194.16 $216.76
Capital Expenditures -11,863,200,000 $204.17 $206.74
Long Term Debt 87,032,000,000 $206.37 $204.54

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $224.95 (USD) for AAPL:NAS. We also generated a valuation of $286.98 (USD) using other metrics and comparables.
The comparable companies were Facebook (FB:NAS), Alphabet (GOOG:NAS) and Microsoft (MSFT:NAS).

Company AAPL:NAS End Date Value
Earnings/Share $11.91 (USD)
Book Value/Share $24.22 (USD)
Sales/Share $50.21 (USD)
Cash Flow/Share $14.36 (USD)
EBITDA/Share $17.41 (USD)
Price Based on Comps Adjustment Factor (%)
$425.66 (USD) -55.4
$156.45 (USD) 0.0
$362.70 (USD) 0.0
$218.45 (USD) -23.6
$255.54 (USD) -0.6
AAPL:NAS Ratios Used Average Values FB:NAS GOOG:NAS MSFT:NAS
19.79 PE Ratio 35.74 22.86 40.40 43.95
9.04 PB Ratio 6.46 5.43 4.41 9.54
4.36 PS Ratio 7.22 8.60 5.84 7.24
15.24 PCF Ratio 16.80 15.21 16.75 18.44
12.87 EV to EBITDA 14.68 13.72 15.71 14.61


Using a multiples approach we generated a valuation of  $167.58 (USD) for AAPL:NAS

Company AAPL:NAS End Date Value
Earnings/Share $11.91 (USD)
Book Value/Share $24.22 (USD)
Sales/Share $50.21 (USD)
Cash Flow/Share $14.36 (USD)
EBITDA/Share $17.41 (USD)
Price Based on Comps Adjustment Factor
$192.45 (USD) 0
$135.63 (USD) 0
$175.33 (USD) 0
$158.32 (USD) 0
$176.16 (USD) 0
Ratios Ratio Average
PE Ratio 16.16
PB Ratio 5.60
PS Ratio 3.49
PCF Ratio 11.02
EV to EBITDA 10.12

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  AAPL:NAS for the last 10 years was  5.56

We ran the Adjusted Book Value for  AAPL:NAS and generated a book value of  $22.53 (USD)
By multiplying these we get an adjusted valuation of  $125.35 (USD)

Analyst Data

In the Stockcalc database there are 7 analysts that provide a valuation for AAPL:NAS. The 7 analysts have a concensus valuation for AAPL:NAS for 2019 of $240.00 (USD).


Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
7 4 0 4.2727 Outperform 2018-11-5

Current Price: 203.77 USD

Analyst Consensus
USD Millions 2019 2020 2021
Mean EPS 13.38 14.99 16.06
# EPS Analysts 9 7 3
Mean Revenue 277,729.50 290,761.60 306,668.90
# Revenue Analysts 7 6 3
Mean Target Price 240.00
Mean Cash Flow 16.89 18.11 20.61
Mean EBITDA 83,158.70 86,067.60 90,523.10
Mean Net Income 61,438.70 63,996.30 69,225.40
Mean Debt Outstanding 46,170.00 41,799.00 -11,158.00
Mean Tax Rate 16.33 16.25 17.50
Mean Growth Rate 9.56
Mean Capital Expenditure 13,092.40 13,297.10 14,219.60

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.

The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).

The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.

With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.

If we have Analyst coverage for the company we use the consensus target price here.

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