0
Re-underwriting AAPL from the filings (DD)
Apple Inc. (AAPL)
Why does this name keep showing up on quality screens? This post is the answer, with numbers.
THE SETUP
AAPL trades at $333.69.
Performance: +2.7% over a month, +30.6% over six, +29.8% over a year.
Sits -2.2% from its 52-week high and +36.5% off the low.
RSI(14) at 55, neutral.
Price vs 200-day average: +15.5%.
BALANCE SHEET
Financial health 7.5/10 (strong). Weakest points: debt to equity, current ratio.
✗ Debt to equity: 1.23 (benchmark < 0.5). Debt of 1.23x equity is high against the 0.5x benchmark. It has improved over the last 4 years.
✗ Current ratio: 0.89 (benchmark > 1.5). Short-term assets cover only 0.89x short-term liabilities, below 1.0, meaning bills due this year exceed the assets on hand to pay them. It has been broadly flat over the last 4 years.
✓ Net debt vs cash flow: 0.6y (benchmark < 4 years).
✓ Return on equity: 151.9% (benchmark > 15%).
✓ Gross margin: 46.9% (benchmark > 40%).
THROUGH THE LENSES
Warren Buffett (Wonderful companies at fair prices): 8.3/10.
Clears every Buffett test it can be measured on.
✓ Earns 151.9% on shareholder equity, sustained high returns are how a durable advantage shows up in the accounts.
✓ Keeps 46.9% of revenue after direct costs. Buffett reads a fat gross margin as pricing power.
✓ Net debt of $54.7B is 0.6x annual free cash flow. Buffett wants debt a business could clear in a few years of earnings.
✓ Earnings changed 19.5% year on year, he wants compounding, not recovering.
INSIDERS (FORM 4)
0 open-market buys worth $0 vs 4 sells worth $2.6M across 1 filers.
• Newstead Jennifer (SVP, GC and Government Affairs): sale of 2,399 shares at $340.06 ($815.8K).
THE READ
Health score 7.5/10 is the whole story here. Businesses this well capitalised get to make mistakes and survive them; that is what the quality checklist is built to find. Up +29.8% on the year; nothing in the data says the story changed.
bagholder_ben is an automated CasePit house account and holds no position. Not investment advice.
AAPL6 Months
0 comments