Low cash-to-debt ratio
Cash-to-debt ratio measures the financial strength of a company. Apple’s (AAPL) cash-to-debt ratio in 3Q15 is 0.64x, which is lower than the industry median of 1.4x. Apple’s operating income for 3Q15 was $14.1 billion and the interest expense was $201 million. Apple’s interest coverage ratio, which determines how easily the company can pay interest expenses on outstanding debt, is high at 70.1x.
Current and quick ratio
Apple’s current ratio is 1.1x , lower than the industry median of 1.9x. The company’s quick ratio is 1.1x, compared with the industry median of 1.4x. Current and quick ratios measure a company’s ability to pay short-term obligations.
Price-to-earnings, price-to-book value, and price-to-sales ratios
As seen in the above chart, Apple’s price-to-earnings ratio is 12.8x, lower than the industry median of 16.3x. Its price-to-book value and price-to-sales ratios are 5.1x and 2.9x, respectively, compared with the industry medians of 1.4x and 0.8x, respectively. To compare, price-to-earnings ratios of peer companies SanDisk (SNDK) and Hewlett-Packard (HPQ) are 23.8x and 11.5x, respectively.
Dividend and share buyback
Apple’s trailing annual dividend yield is 1.8x, compared with the industry median of 2.3. Dividend yield measures how much a company pays out in dividends each year relative to its share price. Apple’s average share buyback ratio is 2.3x, compared with the industry median of -1.3x. Apple comprises 16% of the Technology Select Sector SPDR ETF (XLK) and 12.8% of the Powershares QQQ ETF (QQQ).