Apple (AAPL)
Information Technology · $5.05T market cap · SEC CIK 0000320193
ahead of 73% of the S&P 500 · #22 of 73 in Information Technology
Next reports on Jan 27, 2027, with analysts expecting $2.96 in earnings per share.
52-week range $243.42 to $355.38. 2% below its 52-week high and 43% above its low.
The case for AAPL
- Generated $136B of free cash flow in FY2026, 28% of revenue.
- Earns 128% on shareholder equity.
- 28% of revenue drops through to net profit.
- Revenue growing 15.1% year over year.
- Within 2% of its 52-week high: the trend is up.
The case against
- Expensive for its growth: 38.2× earnings, where 10% a year of growth plus a 0.5% dividend would justify about 24×.
- Priced at 44× book value. Very little hard asset backing here.
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Information Technology companies (momentum is judged against fixed thresholds only), and the five are blended by weight. The score is where that blend places it in the S&P 500. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings and cash, against the growth you get | 34 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 43 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 80 |
| Momentumhow the price has behaved lately | 80 |
| Stabilityhow violently it moves, what it owes and what it pays you | 82 |
- Each factor except momentum is half fixed thresholds, half rank among the 73 Information Technology companies.
The financials
Revenue growth
Is the business growing? Yes
| Last 12 months | +15.1% |
|---|---|
| Over 5 years | +5.5% a year |
| FY2026 revenue | $479B (+15%) |
Free cash flow
Is it generating real cash? Yes, plenty
| FY2026 free cash flow | $136B |
|---|---|
| Of revenue | 28% |
| Of profit | 103% |
Profit margins
Is profitability improving? Holding steady
| Gross margin | 49% |
|---|---|
| Operating margin | 33% |
| Net margin, FY25 → FY26 → now | 26.9% → 27.6% → 27.6% |
Debt vs. cash
Is the balance sheet healthy? Yes, the debt is manageable
| Cash | $36.3B |
|---|---|
| Long-term debt | $68.2B |
| Net debt | $31.9B |
| Years to repay | 0.5 yrs |
Valuation
Is the stock price reasonable? No, expensive
| P/E | 38.2× |
|---|---|
| Fair P/E for its growth | 24× |
| P/FCF | 37.2× |
| Forward P/E | 35.8× |
| EV / EBITDA | 29.7× |
At 38.2× earnings it trades above the 24× that 10% a year of growth plus a 0.5% dividend would justify. At 37.2× free cash flow it trades above that same mark.
The financials, five years deep
Pulled from Apple's XBRL filings on SEC EDGAR. Italic rows are worked out from the others.
| FY2026 | FY2025 | FY2024 | FY2023 | FY2022 | |
|---|---|---|---|---|---|
| Revenue growth | |||||
| Revenue | $479B | $416B | $391B | $383B | $394B |
| Change on the year | +15% | +6% | +2% | −3% | — |
| Free cash flow | |||||
| Free cash flow | $136B | $98.8B | $109B | $99.6B | $111B |
| Of revenue | 28% | 24% | 28% | 26% | 28% |
| Profit margins | |||||
| Gross margin | 48.8% | 46.9% | 46.2% | 44.1% | 43.3% |
| Operating margin | 33.0% | 32.0% | 31.5% | 29.8% | 30.3% |
| Net margin | 27.6% | 26.9% | 24.0% | 25.3% | 25.3% |
| Debt vs. cash | |||||
| Cash | $36.3B | $35.9B | $29.9B | $30.0B | $23.6B |
| Long-term debt | $68.2B | $78.3B | $85.8B | $95.3B | $99.0B |
| Net cash (debt) | −$31.9B | −$42.4B | −$55.8B | −$65.3B | −$75.3B |
What Apple says it does
Company Background The Company designs, manufactures and markets smartphones, personal computers, tablets, wearables and accessories, and sells a variety of related services. The Company’s fiscal year is the 52- or 53-week period that ends on the last Saturday of September. Products iPhone iPhone ® is the Company’s line of smartphones based on its iOS operating system. The iPhone line includes iPhone Duo™, iPhone 18 Pro, iPhone Air ® , iPhone 17, iPhone 17e and iPhone 16. Mac Mac ® is the Company’s line of personal computers based on its macOS ® operating system. The Mac line includes laptops MacBook Neo ® , MacBook Air ® and MacBook Pro ® , including MacBook Pro with PROLED XDR Display and Touch, as well as desktops iMac ® , Mac mini ® and Mac Studio ® . iPad iPad ® is the Company’s line of multipurpose tablets based on its iPadOS ® operating system. The iPad line includes iPad Pro ® , iPad Air ® , iPad and iPad mini ® . Wearables,…
Risk factors AAPL lists in its 10-K
- The Company’s operations and performance depend significantly on global and regional economic conditions
- Global markets for the Company’s products and services are highly competitive and subject to rapid technological change, and the Company may be unable to compete effectively in these markets
- To remain competitive and stimulate customer demand, the Company must successfully manage frequent introductions and transitions of products, services and technologies
- The Company depends on component and product manufacturing and logistical services provided by outsourcing partners, many of which are located outside of the U.S
- Future operating results depend upon the Company’s ability to obtain components, compute capacity and storage resources in sufficient quantities and on commercially reasonable terms
- The Company’s products, services and technologies, including artificial intelligence technologies and features, may be affected from time to time by design and manufacturing defects
- The Company is exposed to the risk of write-downs on the value of its inventory and other assets, in addition to purchase commitment cancellation risk
- The Company relies on access to third-party intellectual property, which may not be available to the Company on commercially reasonable terms, or at all
- The Company’s future performance depends in part on support from third-party software developers
- The Company may be unable to obtain or create digital content that appeals to the Company’s customers or to make such content available on commercially reasonable terms
- The Company depends on the performance of carriers and other resellers
- The Company’s business and reputation are impacted by information technology system failures and network disruptions
- The Company experiences cybersecurity incidents and inadvertent losses and unauthorized access to or releases of confidential information, including personal information
- Investment in new business strategies, commercial relationships and acquisitions could disrupt the Company’s ongoing business and present risks not originally contemplated
- Issues related to artificial intelligence may result in reputational, competitive and financial harm to the Company, regulatory action, legal liability, and other adverse effects to the Company’s business
- The Company is subject to the risks of adverse impacts from legal proceedings and government investigations
- The Company is subject to the risks and costs of complex and changing laws and regulations worldwide
- Varied stakeholder expectations about social and other issues expose the Company to potential liabilities, increased costs, reputational harm, and other adverse effects on the Company’s business
- The Company’s business is subject to a variety of U.S. and international laws, rules, policies and other obligations regarding the collection, use, protection and transfer of personal data
- The Company’s net sales, gross margins and results of operations are subject to volatility and downward pressure due to a variety of factors
- The Company’s financial performance is subject to risks associated with changes in the value of the U.S. dollar relative to local currencies
- The Company is exposed to credit risk and fluctuations in the values of its investment portfolio
- The Company is subject to changes in tax rates, the adoption of new U.S. or international tax legislation and exposure to additional tax liabilities
- The price of the Company’s stock is subject to volatility