AAPL is a growth, high-quality institutional-grade, moderate-risk Electronic Computers company. The company demonstrates healthy revenue growth (9.9% CAGR) with improving profitability — the hallmark of a well-managed franchise. Strong capital efficiency (ROIC: 90.9%) suggests durable competitive advantages that protect against new entrants. Pricing power is a key moat (75/100), providing protection during inflationary periods. The company ranks in the top quartile of its sector (89th percentile), supporting relative conviction. In technology, product cycle timing and TAM expansion define the asymmetry of outcomes — the investment case is balanced between opportunities and risks.
Why this works
The data supports the bull thesis — multiple quality and momentum signals align.
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Sector: Technology | Industry: Electronic Computers
Final Verdict: ▲ BUY (Conviction Score: 80/100)
AAPL competes in the technology sector — an industry defined by rapid innovation cycles, winner-take-most dynamics, and high R&D intensity. The pace of AI adoption, cloud migration, and enterprise digital transformation continues to reshape competitive moats. Companies that fail to invest in next-generation platforms risk commoditization, while those that lead tend to earn outsized returns on capital.
AAPL is currently positioned as a growth, high-quality institutional-grade asset. At its scale (TTM revenue: $749.3B), the company maintains solid growth (9.9% CAGR). Profitability is on a clear upward trajectory with significant margin expansion (+4.7pp operating margin).
Quarterly Momentum:
Composite Scorecard:
| Dimension | Score | Assessment |
|---|---|---|
| Overall Health | 63/100 | Moderate |
| Quality Focus | 71/100 | High |
| Safety | 49/100 | Risky |
| Durability | 65/100 | Average |
| Shareholder Value | 78/100 | Strong |
AAPL's growth profile shows steady momentum:
Revenue Growth: The company is maintaining a moderate 9.9% CAGR, with TTM revenue reaching $749.3B.
Margin Expansion: Profitability is on a clear upward trajectory. Operating margins have expanded by 4.7pp to the current level, while Gross Margins improved by 5.6pp. Five-year margin expansion: +7.4pp.
Cash Flow Powerhouse: The company generated $222.6B in Free Cash Flow, resulting in a healthy FCF margin of 35.9%. FCF CAGR (5Y): 9.0%.
Earnings quality analysis — the discipline of separating sustainable cash-backed profits from accounting-driven earnings — is critical for long-term investment conviction. The "Quality" profile of AAPL is one of its strongest pillars:
Earnings Quality: Rated as Excellent (cash > earnings), with an Operating Cash Flow to Net Income ratio of 128.1%. This indicates that earnings are backed by hard cash rather than accounting maneuvers.
Value Creation: ROIC stands at 90.9% (Δ+44.2pp), the company remains in a value-creation phase. 5-year average ROIC: 58.3%. vs. sector median: +57.5pp.
Accounting Integrity (Beneish M-Score): The M-Score of -2.30 indicates a very low risk of earnings manipulation.
Piotroski F-Score: 7/9 — Strong fundamentals.
R&D Investment: The company invests 7.6% of revenue in R&D, showing meaningful investment in future growth.
Solvency: The company is aggressively deleveraging. Debt-to-Equity stands at 1.00x
Liquidity: Current ratio of 0.97x indicates tight liquidity. Short-term obligations may require attention.
Bankruptcy Risk: The Altman Z-Score stands at 2.34. While technically in the 'Grey Zone,' this is common for high-growth companies with large asset bases.
Refinancing Risk: Rated as Moderate (34/100). Given its financial position, the company is well-shielded from interest rate spikes.
Fundamental Beta: 0.65 (defensive, P12). The company exhibits low systematic risk — stable earnings, conservative leverage, and ample liquidity suggest resilience during market downturns.
Technology companies are growth-duration assets — their macro sensitivity runs primarily through discount rates and corporate capex budgets. Rising rates compress multiples while decelerating corporate spending reduces billings growth. AAPL exhibits a moderate sensitivity profile:
No macro sensitivity data available for this ticker.
Shareholder Returns: AAPL currently returns 120% of FCF to shareholders via dividends (14%) and buybacks (106%). The company actively returns capital to shareholders, signaling management confidence in cash flow durability and limited high-ROIC reinvestment opportunities. (Stock-Based Compensation: 2.5% of revenue)
Share Count: Relatively stable with -2.2% change.
Insider Sentiment: Heavy Selling. There has been net selling activity (approx. $12,101,153.94) by insiders like Adams Katherine L. (SVP, GC and Secretary). The lack of recent insider buying is notable.
Within the Technology sector (Electronic Computers), AAPL ranks as follows:
Competitive Assessment: AAPL demonstrates sector-leading fundamentals, suggesting durable competitive advantages — whether through brand, scale, technology, or regulatory positioning — that justify a premium allocation within Technology exposure.
| Metric | Status | Rating |
|---|---|---|
| Growth | 9.9% CAGR | Strong |
| Quality | OCF/NI 128% | Elite |
| Risk | Z-Score 2.34 | Grey Zone |
| Regime Fit | Unknown | Adequate |
| Composite Health | 63/100 | Moderate |
| Sector Rank | 89th percentile | Top Quartile |
Synthesis: AAPL offers an attractive risk/reward profile within Technology (89th percentile). The composite health score (63/100) confirms fundamental adequacy, growth momentum and quality earnings support a constructive stance. The thesis remains balanced — conviction is moderate rather than emphatic.
Verdict: ▲ BUY
Conviction Score: 80/100
Recommended Action: Accumulate on weakness. Target market weight. Multiple quality signals align.
Conviction Drivers: Positive: +Quality, +CapEff, +Margins, +ROIC, +EarningsQuality, +Piotroski, +FFQuality, +SectorLeader | Negative: -InsiderSelling, -CashBurn, -Dilution (anchored to Health: 63/100)
AAPL is a growth, high-quality institutional-grade, moderate-risk Electronic Computers company. The company demonstrates healthy revenue growth (9.9% CAGR) with improving profitability — the hallmark of a well-managed franchise. Strong capital efficiency (ROIC: 90.9%) suggests durable competitive advantages that protect against new entrants. Pricing power is a key moat (75/100), providing protection during inflationary periods. The company ranks in the top quartile of its sector (89th percentile), supporting relative conviction. In technology, product cycle timing and TAM expansion define the asymmetry of outcomes — the investment case is balanced between opportunities and risks.
This investment memo for AAPL (Technology — Electronic Computers) was generated using quantitative analysis of 20 quarterly SEC filings spanning 2021-03 to 2025-12. Models applied: Beneish M-Score, Piotroski F-Score, Altman Z-Score, Fama-French factor analysis, composite health scoring (v2.1), macro regime sensitivity, insider activity analysis, and labor efficiency metrics. Latest filing: 2025-12-27. All data sourced from SEC EDGAR XBRL filings.
Institutional, 13F Holdings & Large Shareholder Filings
| Fund | Shares | Value |
|---|---|---|
| Vanguard Group | 1.43B | $387.7T |
| Vanguard Group | 33.3M | $394.1B |
| Soros Fund Management | 416K | $113.2B |
| Bridgewater Associates | 289K | $78.7B |
| Vanguard Group | 395K | $6.7B |
| Renaissance Technologies | 101K | $1.7B |
Bankruptcy risk — annual evolution
Earnings manipulation — annual evolution
Last 90 days
| Company | Health | Growth | |
|---|---|---|---|
AAPL Current | 63 | — | |
SMCI Super Micro Computer, Inc. | 37 | 152.8% | |
DELL Dell Technologies Inc. | 34 | -9.3% | |
OMCL OMNICELL, INC. | 19 | 6.9% |