Apple Inc. (AAPL): investment thesis checklist
What a value investor writing down why they own Apple Inc. would be relying on, read from its filings: the figures that have carried the business, the lines a reader might set on them, and the published tests it meets today. A list to write against, not a view on the company.
1. The figures the case would rest on
- Return on invested capital: 74.8% in FY2025; between 35.9% and 74.8% over 7 filed years, median 62.4%. Does the thesis need it to stay inside that range?
- Return on equity: 151.9% in FY2025; between 35.6% and 197.0% over 10 filed years, median 119.0%. Does the thesis need it to stay inside that range?
- Free cash flow yield: 2.6% in FY2025; between 2.6% and 8.6% over 10 filed years, median 4.1%. Does the thesis need it to stay inside that range?
- EV to EBIT: 29.38x in FY2025; between 16.84x and 30.96x over 7 filed years, median 24.51x. Does the thesis need it to stay inside that range?
- Price to earnings: 34.24x in FY2025; between 13.56x and 37.47x over 10 filed years, median 25.41x. Does the thesis need it to stay inside that range?
- Gross margin: 46.9% in FY2025; between 37.8% and 46.9% over 10 filed years, median 40.4%. Does the thesis need it to stay inside that range?
- Operating margin: 32.0% in FY2025; between 24.1% and 32.0% over 10 filed years, median 28.8%. Does the thesis need it to stay inside that range?
- Net debt to EBITDA: 0.53x in FY2025; between 0.53x and 1.09x over 7 filed years, median 0.77x. Does the thesis need it to stay inside that range?
- Revenue growth, 5-year CAGR: 8.7% in FY2025; between 3.3% and 14.8% over 10 filed years, median 8.6%. Does the thesis need it to stay inside that range?
- Share count change: -2.6% in FY2025; between -7.0% and -2.6% over 9 filed years, median -3.8%. Does the thesis need it to stay inside that range?
2. What must stay true: guardrails a reader might set
Each line is drafted from Apple Inc.'s own current figure, never from a level we think a business should clear, and replayed over its filed years. They are a reader's to keep, edit or drop.
Debt to Equity stays at or below 1.9x
Today 1.52x. Replayed over 7 filed years, it would have broken in 4; most recently FY2024, at 2.09x (10-K, filed 2024-11-01).
Return on Invested Capital stays at or above 59.8%
Today 74.77%. This indicator depends on inputs (market price, multi-statement composites) whose history is not deep enough to re-derive it with the same formula as the live value, so no honest retro-test exists for it.
Dividend Rate stays at or above $1.06
Today $1.08. This indicator depends on inputs (market price, multi-statement composites) whose history is not deep enough to re-derive it with the same formula as the live value, so no honest retro-test exists for it.
3. What would break it
- A filed year in which debt to equity rose above 1.9x.
- A filed year in which return on invested capital fell below 59.8%.
- A filed year in which dividend rate fell below $1.06.
4. The published tests it meets today
Of 30 tests value investors published: 5 met, 25 not met, 0 we could not complete. Counts, never a score.
Meets: Three forensic scores; Gross margin, turnover (Robert Novy-Marx); ROIC at or above WACC; High return on tangibles; Cash-covered dividend.
What this cannot tell you
What the numbers say today, not the day one stops being true. The reasons are not written down.
An account adds
One email the night a number you wrote down breaks. Silence otherwise.
No card. 30 free days, and nothing is charged unless you choose a plan.
How this is computedA computation on accounts filed with the SEC, not a recommendation and not advice. Past filings do not indicate future results. Risk disclaimer.