• We were pleased with AAPL’s recent initiatives, such as the opening of its first store in India, and the launching of new solutions, including Apple Pay Later (offering two-month loans for consumers) and Apple Card Savings (offering high-yield savings accounts). 
  • Due to increased odds of rate cuts in H2-2023, we are expecting a rally in tech stocks. Key headwinds include slower global GDP growth, and weak 2023 sales forecasts for PCs (-7% YoY), tablets (-3% YoY), and smartphones (-4% YoY) - Source: Gartner. The IMF is projecting global GDP growth to decline to 2.8% in 2023, from 3.4% in 2022.
Key Financial Data (YE Sept 30, $M) 2017 2018 2019 2020 2021E 2022E
Cash, cash equivalent and marketable securities 268,895 237,100 205,898 191,830 184,620 189,006
Working Capital 27,831 15,410 57,101 38,321 56,547 80,773
Total Assets 375,319 365,725 338,516 323,888 327,615 341,152
Revenue 229,234 265,595 260,174 274,515 351,984 385,856
Net Income 48,351 59,531 55,256 57,411 92,361 101,182
EPS Diluted ($) 2.32 3 2.99 3.28 5.5 6.03

 

Relative Valuation - AAPL  
EPS 2022E ($) $6.29
EPS 2023E ($) $6.74
Target P/E multiple for 2022E (x) - 20% premium to avg 29.1x
Target P/E Multiple for 2023E (x) - 20% premium to avg 25.9x
   
Fair value per share ($) - P/E Multiple (2022E) 182.81
Fair value per share ($) - P/E Multiple (2023E) 174.61