Definitive Analysis
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Earnings Power Value Snapshot (AAPL)
RangeSelected
WACC / Discount Rate 8.68% to 6.82% 7.75%
Sustainable Margin44.47%
Sustainable EBIT Margin41.65%
Average Capex (M)10,982.80
Margins based on 5-year sustainable average. CapEx excludes growth capex.
Blended Fair Value (Avg Low/High)$112.73
Stock Price$278.78
Safety Margin30.00%
Buy Price$78.91
Buy / Don't BuyHOLD / SELL
Earnings Power Value Calculations
(USD in millions except fair price)
Revenue390,125.20
5 Yr Avg Sustainable Revenue390,125.20
(*) Gross Margin44.47%
Sustainable Gross Profit173,474.35
(–) 5 Yr Maintenance CapEx10,977.45
Normalized EBIT162,496.90
5 Yr Avg Tax Rate16.79%
After-tax Normalized EBIT135,221.12
5 Yr Avg CapEx10,982.80
(–) 5 Yr Avg D&A11,410.00
Difference-427.20
Normalized Earnings162,496.90
EPV Sensitivity Analysis
(Financials in millions, Share Price in absolute)
Low CaseBase CaseHigh Case
Normalized Earnings 162,496.90 162,496.90 162,496.90
(/) WACC 8.68% 7.75% 6.82%
Enterprise Value 1,557,846.97 1,744,788.61 1,982,714.33
(–) Net Debt 78,838.00 78,838.00 78,838.00
Equity Value 1,479,008.97 1,665,950.61 1,903,876.33
(/) Shares Outstanding 15,004.70 15,004.70 15,004.70
EPV Fair Value $98.57 $111.03 $126.89
Stock Price $278.78 $278.78 $278.78
Upside / Downside -64.64% -60.17% -54.49%
Safety Margin 30.00%30.00%30.00%
Buy Price $69.00 $77.72 $88.82
Buy / Don't Buy Don't Buy Don't Buy Don't Buy