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AAPL, a 4% yield
Current, target price 146, 203 (+39%)
July 29th, 2021
1 minute read
Sales down
Costs, margins up
1 minute read
Sales down
- Sales declined by -9% in the second quarter to 81,434 million dollars which is below our forecast 89,584 million dollars.
- This brings the average quarterly growth to 13%.
- We predict average growth of 5% in this next 12 months to bring sales to 93,085 million dollars in the second quarter 2022.
Costs, margins up
- The cash cost ratio of net profit add depreciation minus sales as a percent of sales improved to -68% in the second quarter but profit was lower at 21,744 million dollars.
- Average quarterly costs are now at -70%.
- We use the average -70% costs to predict a 23,842 million dollars net profit in the second quarter of 2022.
Cashflow, down on working capital
Balance sheet, higher leverage
Value, a 4% yield
- Cashflow was down to 19,001 million dollars with investment spending of -2,093 million dollars in the second with negative working capital.
- But average quarterly Cashflow has now improved to 23,692 million dollars.
- We use the same -2,093 million dollars investment spending which with higher sales gives a higher 25,796 million dollars cashflow in the second quarter 2022.
Balance sheet, higher leverage
- Cash declined from 38,466 to 34,050 million dollars in the second quarter.
- Liabilities declined from 267,980 to 265,560 million dollars so net cash worsened from -229,514 to -231,510 million dollars.
- With our forecast higher cashflow & assuming there’s a -88,385 million dollars equity payout, net cash will improve to -213,873 million dollars in 12 months time.
Value, a 4% yield
- AAPL capital from the last six years increased to 378,054 million dollars in the second quarter.
- At the current market value of 2,441,000 million dollars, based on our forecasts, it’s at 6.2X sales & 7.6X assets with a 4% yield.
- Our free cashflow forecast is 106,022 million dollars. At 32X (3% yield), this gives a 39% higher target price of 203 dollars.
