Apple Inc.
Fundamental — what it's worthbottom-up fair value
Built up from four lenses — a consolidated DCF, a segment sum-of-the-parts, forward multiples and a normalized-earnings view — blended into one weighted central fair value. What is it worth?
Is it cheap or expensive right now?
Latest price vs our fair value. A comparison, not a recommendation.
What it's worth — four lenses
Four independent valuation methods, blended into one weighted central fair value; the DCF-vs-multiple spread is itself the signal of the weight.
| Valuation lens | Per share (USD) |
|---|---|
| Consolidated DCF (FCFF) — floor | 152 |
| Segment sum-of-the-parts | 184 |
| Forward relative multiples | 249 |
| Normalized earnings power — ceiling | 253 |
| Weighted central fair value | 208 · −34% vs spot |
The lenses span a wide range — the consolidated DCF near $152 and the segment sum-of-the-parts near $184 mark the cash-and-asset floor; forward multiples ($249) and normalized earnings ($253) mark the ceiling. The gap between the two families is the durability premium — the installed base, switching costs and Services annuity the explicit five-year model does not capitalise.
Technical & price structuretrend, momentum, key levels
Trend, momentum and key levels — what is the price doing now?
What the chart says
In plain terms: Apple trades well above our weighted central fair value — richly valued on every fundamental lens. It is the highest-quality cash machine in technology: an iPhone-led hardware franchise (iPhone, Mac, iPad and Wearables) wrapped around a fast-growing, high-margin Services layer (App Store, licensing, iCloud, advertising, payments). On modelled cash flows the consolidated DCF is near $152 and the segment sum-of-the-parts near $184; forward multiples ($249) and normalized earnings ($253) sit higher, and the roughly $90 gap between the two families is the durability premium — the installed base, switching costs and Services annuity the explicit five-year model does not capitalise. The bull case needs Services to keep compounding and an AI-led iPhone upgrade cycle to land; the cautious case is a regulated Services take-rate and flat hardware as the multiple de-rates. Over three months the distribution is near-even on direction with a mild downside tilt from event skew — not a view that the shares are cheap or expensive, just where price could travel from here.
Key levels
Volatility & where the case breaks
| Typical daily moveRoughly how far the price swings in an average day (based on a measure called ATR). Bigger means choppier. | ~1.8% |
Monte Carlo — where could the price go?near-term price paths
50,000 simulated futures — near-term price paths, independent of the fundamental value.
The 5th–95th and 25th–75th percentile bands from the 50,000-path simulation. Static and pre-computed — independent of the fundamental levers above.
The exact percentiles
The 5th / 25th / middle / 75th / 95th outcomesLine up all 50,000 outcomes low to high — these are the values at the 5%, 25%, 50%, 75% and 95% marks., from 50,000 paths.
| Timeframe | Rare low (5%) | 25% | Middle | 75% | Rare high (95%) |
|---|
What drives the odds
50,000 paths, 16 forces: the Services/AI-cycle drift, iPhone & hardware volumes, gross-margin mix, Nasdaq/high-beta flows, US real rates and FX — plus event forces: an AI-upgrade/WWDC catalyst, a Services-growth print, a quarterly earnings/margin print, a capital-return refresh, a China demand/share shock, an App Store/antitrust ruling and the Google traffic-acquisition outcome. Zero secular drift (international name); the mild downside tilt is event skew, not a valuation view.
Peer set & risks
Where Apple sits in its markets
Apple sits within the US mega-cap technology cohort, which trades at a premium to the broad market on the strength of durable franchises, high returns on capital and secular growth. Within the cohort Apple is the highest-quality cash machine but among the slower growers, which is why its forward multiple sits above the median but below the AI-capex-levered names. The peer table is context for the relative lens, not a recommendation.
| Company | Fwd P/E | EV/EBITDA | Revenue growth · note |
|---|---|---|---|
| Apple (AAPL) | 38× | 27× | low-single · subject; quality anchor |
| Microsoft (MSFT) | 32× | 22× | low-double · cloud & AI |
| Alphabet (GOOGL) | 22× | 15× | low-double · search & cloud |
| Amazon (AMZN) | 34× | 16× | low-double · retail & AWS |
| Nvidia (NVDA) | 34× | 30× | high · AI compute |
| Meta (META) | 24× | 14× | mid-double · ads & AI |
| Mega-cap median (ex-AAPL) | 31× | 18× | low-double · cohort context |
Apple carries the highest forward multiple in the cohort on the slowest revenue growth — the durability premium in one line. The study's own principal risks restate what that premium is exposed to: regulatory compression of the Services take-rate (App Store economics, the Google TAC ruling), China demand and supply-chain concentration, a failure of the AI-led upgrade cycle to materialise, and gross-margin give-back. Relative multiples only, not advice.
About this series & how we build these
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Edition: 06 Jul 2026. Older editions stay in the Library.