Apple Inc (AAPL) — Attractive Rating — for Ask Matt Readers

Apple Inc (AAPL) earned our Attrac­tive Rat­ing. To get this rat­ing, AAPL achieved excel­lent quality-of-earnings (1) pos­i­tive and ris­ing eco­nomic prof­its (as dis­tinct from account­ing prof­its**) and (2) a cheap val­u­a­tion. As shown in our free report on AAPL, the company’s ROIC (at 136%) is in the Top Quin­tile of the 3000+ compa­nies we cover.

HIDDEN GEM: AAPL’s economic earnings rose more than its accounting earnings during the last fiscal year. Economic earnings rose by $3,576 while accounting earnings rose by $3,401. And the company has $31,849mm in Excess Cash, a reflec­tion of the strong prof­itabil­ity of the busi­ness .

See Appen­dix 4 to learn how AAPL increased NOPAT by and increased its NOPAT Mar­gin as expenses grew more slowly than rev­enue. See Appen­dix 5 for details on  its Invested Cap­i­tal. Appen­dix 7 (in the Return on Invested Cap­i­tal (ROIC) sec­tion) shows how the improved NOPAT Margin and Invested Cap­i­tal Turns result in an increase in ROIC (to 135% from 104%) and Eco­nomic Profit, which rose by $3,576 while accounting earnings rose by $3,401 dur­ing its last fis­cal year.

As per Invest­ment Strat­egy 101 and How to make money pick­ing stocks, AAPL has Attrac­tive Risk/Reward.,

**See Finance 101 and Eco­nomic Ver­sus Account­ing Prof­its for more detail on why account­ing prof­its are not reli­able indi­ca­tors of cor­po­rate prof­itabil­ity or value creation.