Apple Inc. (AAPL) Discounted Future Market Cap

Apple Inc.

AAPL (NASDAQ)

(%)

Valuation
Apple Inc. Discounted Future Market Cap

"""
    Model: Discounted Future Market Cap

# Render model description
model.render_description(r"""
## Discounted Future Market Cap

This model estimates the intrinsic value of a common share by projecting the Future Market Capitalization using the estimated PE Ratio and then discounting it to the Present using an Annual Required Rate of Return.
""")

# Initialize assumptions
assumptions.init({
    "data": {
        "%discount_rate": None,
        "beta": data.get("profile:beta", default=1),
        "%risk_free_rate": data.get("treasury:year10"),
        "%market_premium": data.get("risk:totalEquityRiskPremium"),
        "pe_ratio": data.get("ratio:priceEarningsRatio"),
        "%revenue_growth_rate": None,
        "%net_income_margin": None,
        "historical_years": 10,
        "projection_years": 5,
    },
    "hierarchies": [{
        "parent": "%discount_rate",
        "children": ["beta", "%risk_free_rate", "%market_premium"]
    }]
})

# Calculate cost of equity
cost_of_equity = assumptions.get("%risk_free_rate") + assumptions.get("beta") * assumptions.get("%market_premium")
assumptions.set("%discount_rate", cost_of_equity)

# Compute metrics
data.compute({
    "%grossMargin": "income:grossProfit / income:revenue",
    "%operating_margin": "income:operatingIncome / income:revenue",
    "%netMargin": "income:netIncome / income:revenue",
    "%revenueGrowthRate": "function:growth:income:revenue",
    "%netIncomeGrowthRate": "function:growth:income:netIncome",
    "%totalStockholdersEquityGrowthRate": "function:growth:balance:totalStockholdersEquity",

# Calculating NOPAT (Net Operating Profit After Taxes)
    "%taxRate": "income:incomeTaxExpense / income:incomeBeforeTax",
    "incomeTax": "income:operatingIncome * %taxRate",
    "nopat": "income:operatingIncome - incomeTax",

# Calculating Invested Capital
    "investedCapital": [
        "balance:totalNonCurrentAssets", "-", "balance:cashAndCashEquivalents", "+",
        "balance:totalCurrentAssets", "-", "balance:totalCurrentLiabilities"
    ],
    "%roic": "nopat / investedCapital",
})

data.set_default_range(f"{-assumptions.get('historical_years')}->0")

assumptions.set("%net_income_margin", data.average(f"%netMargin"))
assumptions.set_bounds(
    "%net_income_margin", low=0, high="100%"
)

assumptions.set("%revenue_growth_rate", data.average(f"%revenueGrowthRate"))
assumptions.set_bounds(
    "%revenue_growth_rate", low=0, high="25%"
)

# Compute forecasted values and ratios
data.compute({
    "income:revenue": f"""
        income:revenue:-1 * 
        (1 + {assumptions.get('%revenue_growth_rate')})
    """,
    "%revenueGrowthRate": "function:growth:income:revenue",
    "income:netIncome": f"income:revenue * {assumptions.get('%net_income_margin')}",
}, forecast=assumptions.get("projection_years"))

projected_revenue = data.get("income:revenue")
projected_net_income = data.get(f"income:netIncome:{assumptions.get('projection_years')}")

shares_outstanding = data.get("income:weightedAverageShsOut")
future_market_cap = assumptions.get("pe_ratio") * projected_net_income
discounted_future_market_cap = future_market_cap / (
            (1 + assumptions.get("%discount_rate")) ** assumptions.get("projection_years"))

stock_value = discounted_future_market_cap / shares_outstanding

# Set the final value
model.set_final_value({
    "value": stock_value,
    "units": "$"
})

# Render results
model.render_results([
    [stock_value, "Present Value", "$"],
    [projected_net_income, "Estimated net income", "$"],
    [future_market_cap, "Estimated market capitalization", "$"],
    [discounted_future_market_cap, "Market capitalization discounted to present", "$"],
    [shares_outstanding, "Shares Outstanding", "#"],
    [data.get("income:eps"), "Earnings Per Share (EPS)", "$"],
    [data.get("profile:price"), "Market Price", "$"],
    [data.get("ratio:priceEarningsRatio"), "Price to Earnings (PE) Ratio", "#"]
])

# Render chart
model.render_chart({
    "data": {
        "income:revenue": "Revenue",
        "income:netIncome": "Net Income"
    },
    "start": -assumptions.get("historical_years"),
    "end": "*",
    "properties": {
        "title": "Historical and forecasted data",
        "set_editable": [
            "income:revenue",
            "income:netIncome"
        ]
    }
})

# Render table for estimated future values
model.render_table({
    "data": {
        "income:revenue": "Revenue",
        "%revenueGrowthRate": "Revenue Growth Rate",
        "income:netIncome": "Net Income",
    },
    "start": -1,
    "end": "*",
    "properties": {
        "title": "Estimated Future Values",
        "order": "ascending",
        "number_format": "M"
    }
})

# Render historical values table
model.render_table({
    "data": {
        "income:revenue": "Revenue",
        "income:costOfRevenue": "Cost of Revenue",
        "income:grossProfit": "Gross Profit",
        "%grossMargin": "Gross Margin",
        "income:operatingIncome": "Operating Income",
        "%operating_margin": "Operating Margin",
        "income:netIncome": "Net Income",
        "%netMargin": "Net Margin",
    },
    "start": -assumptions.get("historical_years"),
    "end": 0,
    "properties": {
        "title": "Historical Values",
        "display_averages": True,
        "order": "descending",
        "number_format": "M"
    },
})

# Render historical growth rates table
model.render_table({
    "data": {
        "income:revenue": "Revenue",
        "%revenueGrowthRate": "Revenue Growth Rate",
        "income:netIncome": "Net Income",
        "%netMargin": "Net Margin",
        "%netIncomeGrowthRate": "Net Income Growth Rate",
        "balance:totalStockholdersEquity": "Stockholders Equity",
        "%totalStockholdersEquityGrowthRate": "Equity Growth Rate",
        "%roic": "Return on Invested Capital (ROIC)",
        "nopat": "After-tax Operating Income",
        "%taxRate": "Income Tax Rate",
        "investedCapital": "Invested Capital",
    },
    "start": -assumptions.get("historical_years"),
    "end": 0,
    "properties": {
        "title": "Historical Growth Rates",
        "display_averages": True,
        "order": "descending",
        "number_format": "M"
    },
})

# Set description for assumptions
assumptions.set_description({
    "%discount_rate": r"""
        ## Discount Rate

`Discount Rate` = `Cost of Equity` = `Risk Free Rate` + `Beta` * `Market Premium`

The cost of equity is the theoretical rate of return that an equity investment should generate. It is calculated using the CAPM formula.

[Read More](https://www.investopedia.com/terms/c/costofequity.asp#mntl-sc-block_1-0-20)
    """,

"beta": r"""
        ## Beta

Beta is a value that measures the price fluctuations (volatility) of a stock with respect to fluctuations in the overall stock market.
    """,

"%risk_free_rate": r"""
        ## Risk-Free Rate

The risk-free rate represents the interest an investor would expect from an absolutely risk-free investment over a specified period of time.
        By default, it is equal to the current yield of the U.S. 10 Year Treasury Bond.
    """,

"%market_premium": r"""
        ## Market Premium

Market risk premium represents the excess returns over the risk-free rate that investors expect for taking on the incremental risks connected to the equities market.
    """,

"pe_ratio": r"""
        ## Price to Earnings (PE) Ratio

Estimated Price to Earnings (PE) Ratio at the end of the projection period.

`Future Market Cap` = `PE Ratio` * `Projected Net Income`
    """,

"%revenue_growth_rate": r"""
        ## Revenue Growth Rate

The annual revenue growth rate is applied to projected revenue starting from the second projection year onward.
    """,

"%net_income_margin": r"""
        ## Net Income Margin

Net Income expressed as a percentage of Revenue.
    """,

"historical_years": r"""
        ## Historical Years

The number of historical years used to calculate averages for historical data.
    """,

"projection_years": r"""
        ## Projection Years

The number of years for projecting the analysis into the future.
    """,
})

print("End of model.")

Estimated Value

USD

Market Price USD

* Values are not guaranteed, please do your own
research before making investment decisions.

Discounted Future Market Cap

Interactive Assumptions

Discount Rate Discount Rate `Discount Rate` = `Cost of Equity` = `Risk Free Rate` + `Beta` * `Market Premium` The cost of equity is the theoretical rate of return that an equity investment should generate. It is calculated using the CAPM formula. Read More	%
↳ Beta Beta Beta is a value that measures the price fluctuations (volatility) of a stock with respect to fluctuations in the overall stock market.	#
↳ Risk Free Rate Risk-Free Rate The risk-free rate represents the interest an investor would expect from an absolutely risk-free investment over a specified period of time. By default, it is equal to the current yield of the U.S. 10 Year Treasury Bond.	%
↳ Market Premium Market Premium Market risk premium represents the excess returns over the risk-free rate that investors expect for taking on the incremental risks connected to the equities market.	%
Pe Ratio Price to Earnings (PE) Ratio Estimated Price to Earnings (PE) Ratio at the end of the projection period. `Future Market Cap` = `PE Ratio` * `Projected Net Income`	#
Revenue Growth Rate Revenue Growth Rate The annual revenue growth rate is applied to projected revenue starting from the second projection year onward.	%
Net Income Margin Net Income Margin Net Income expressed as a percentage of Revenue.	%
Historical Years Historical Years The number of historical years used to calculate averages for historical data.	#
Projection Years Projection Years The number of years for projecting the analysis into the future.	#

Results
Present Value	187.7 USD
Estimated net income	131.4 Bil. USD
Estimated market capitalization	4,344 Bil. USD
Market capitalization discounted to present	2,806 Bil. USD
Shares Outstanding	14.95 Bil.
Earnings Per Share (EPS)	7.48 USD
Market Price	247.6 USD
Price to Earnings (PE) Ratio	33.05

Historical and forecasted data

Monetary values in USD

{"sectionId": "section-chart-1", "sectionType": "chart", "title": "Historical and forecasted data", "timeseries": "annual", "series": [{"label": "Revenue", "mappingKey": "income:revenue", "data": [{"l": "2016", "x": "2016-09-24", "y": 215639000000}, {"l": "2017", "x": "2017-09-30", "y": 229234000000}, {"l": "2018", "x": "2018-09-29", "y": 265595000000}, {"l": "2019", "x": "2019-09-28", "y": 260174000000}, {"l": "2020", "x": "2020-09-26", "y": 274515000000}, {"l": "2021", "x": "2021-09-25", "y": 365817000000}, {"l": "2022", "x": "2022-09-24", "y": 394328000000}, {"l": "2023", "x": "2023-09-30", "y": 383285000000}, {"l": "2024", "x": "2024-09-28", "y": 391035000000}, {"l": "2025", "x": "2025-09-27", "y": 416161000000}, {"l": "2026", "x": "2026-09-27", "y": 440602135530, "oy": 440602135530, "e": true, "d": 2026, "g": 5.87, "og": 5.87}, {"l": "2027", "x": "2027-09-27", "y": 466478698949, "oy": 466478698949, "e": true, "d": 2027, "g": 5.87, "og": 5.87}, {"l": "2028", "x": "2028-09-27", "y": 493874992938, "oy": 493874992938, "e": true, "d": 2028, "g": 5.87, "og": 5.87}, {"l": "2029", "x": "2029-09-27", "y": 522880271274, "oy": 522880271274, "e": true, "d": 2029, "g": 5.87, "og": 5.87}, {"l": "2030", "x": "2030-09-27", "y": 553589029606, "oy": 553589029606, "e": true, "d": 2030, "g": 5.87, "og": 5.87}], "dataType": ".", "displayAs": "line", "dataTimeseries": "annual", "hidden": false}, {"label": "Net Income", "mappingKey": "income:netIncome", "data": [{"l": "2016", "x": "2016-09-24", "y": 45687000000}, {"l": "2017", "x": "2017-09-30", "y": 48351000000}, {"l": "2018", "x": "2018-09-29", "y": 59531000000}, {"l": "2019", "x": "2019-09-28", "y": 55256000000}, {"l": "2020", "x": "2020-09-26", "y": 57411000000}, {"l": "2021", "x": "2021-09-25", "y": 94680000000}, {"l": "2022", "x": "2022-09-24", "y": 99803000000}, {"l": "2023", "x": "2023-09-30", "y": 96995000000}, {"l": "2024", "x": "2024-09-28", "y": 93736000000}, {"l": "2025", "x": "2025-09-27", "y": 112010000000}, {"l": "2026", "x": "2026-09-27", "y": 104598946974, "oy": 104598946974, "e": true, "d": 2026, "g": -6.62, "og": -6.62}, {"l": "2027", "x": "2027-09-27", "y": 110742043130, "oy": 110742043130, "e": true, "d": 2027, "g": 5.87, "og": 5.87}, {"l": "2028", "x": "2028-09-27", "y": 117245923323, "oy": 117245923323, "e": true, "d": 2028, "g": 5.87, "og": 5.87}, {"l": "2029", "x": "2029-09-27", "y": 124131776400, "oy": 124131776400, "e": true, "d": 2029, "g": 5.87, "og": 5.87}, {"l": "2030", "x": "2030-09-27", "y": 131422035628, "oy": 131422035628, "e": true, "d": 2030, "g": 5.87, "og": 5.87}], "dataType": ".", "displayAs": "line", "dataTimeseries": "annual", "hidden": false}], "editableDates": {"2026-09-27": 42, "2027-09-27": 43, "2028-09-27": 44, "2029-09-27": 45, "2030-09-27": 46}, "properties": {"display_table": true}, "width": "full"}

Edit Chart Values	2026-09-27	2027-09-27	2028-09-27	2029-09-27	2030-09-27

↳ Growth Rate

Estimated Future Values

Monetary values in USD amounts except #	2025 Sep 27	LTM Jan 22	2026 Sep 27	2027 Sep 27	2028 Sep 27	2029 Sep 27	2030 Sep 27
Revenue	416,161	416,161	440,602	466,479	493,875	522,880	553,589
Revenue Growth Rate	6.43%	0%	5.87%	5.87%	5.87%	5.87%	5.87%
Net Income	112,010	112,010	104,599	110,742	117,246	124,132	131,422

Monetary values in USD

amounts except #

2025
Sep 27

LTM
Jan 22

2026
Sep 27

2027
Sep 27

2028
Sep 27

2029
Sep 27

2030
Sep 27

Revenue

416,161

440,602

466,479

493,875

522,880

553,589

Revenue Growth Rate

6.43%

5.87%

Net Income

112,010

104,599

110,742

117,246

124,132

131,422

Historical Values

Monetary values in USD amounts except #	Average	LTM Jan 22	2025 Sep 27	2024 Sep 28	2023 Sep 30	2022 Sep 24	2021 Sep 25	2020 Sep 26	2019 Sep 28	2018 Sep 29	2017 Sep 30	2016 Sep 24
Revenue	328,359	416,161	416,161	391,035	383,285	394,328	365,817	274,515	260,174	265,595	229,234	215,639
Cost of Revenue	188,223	220,960	220,960	210,352	214,137	223,546	212,981	169,559	161,782	163,756	141,048	131,376
Gross Profit	140,135	195,201	195,201	180,683	169,148	170,782	152,836	104,956	98,392	101,839	88,186	84,263
Gross Margin	41.93%	46.91%	46.91%	46.21%	44.13%	43.31%	41.78%	38.23%	37.82%	38.34%	38.47%	39.08%
Operating Income	95,862	133,050	133,050	123,216	114,301	119,437	108,949	66,288	63,930	70,898	61,344	60,024
Operating Margin	28.67%	31.97%	31.97%	31.51%	29.82%	30.29%	29.78%	24.15%	24.57%	26.69%	26.76%	27.84%
Net Income	79,588	112,010	112,010	93,736	96,995	99,803	94,680	57,411	55,256	59,531	48,351	45,687
Net Margin	23.74%	26.92%	26.92%	23.97%	25.31%	25.31%	25.88%	20.91%	21.24%	22.41%	21.09%	21.19%

Historical Growth Rates

Monetary values in USD amounts except #	Average	LTM Jan 22	2025 Sep 27	2024 Sep 28	2023 Sep 30	2022 Sep 24	2021 Sep 25	2020 Sep 26	2019 Sep 28	2018 Sep 29	2017 Sep 30	2016 Sep 24
Revenue	328,359	416,161	416,161	391,035	383,285	394,328	365,817	274,515	260,174	265,595	229,234	215,639
Revenue Growth Rate	5.87%	0%	6.43%	2.02%	-2.8%	7.79%	33.26%	5.51%	-2.04%	15.86%	6.3%	-7.73%
Net Income	79,588	112,010	112,010	93,736	96,995	99,803	94,680	57,411	55,256	59,531	48,351	45,687
Net Margin	23.74%	26.92%	26.92%	23.97%	25.31%	25.31%	25.88%	20.91%	21.24%	22.41%	21.09%	21.19%
Net Income Growth Rate	8.63%	0%	19.5%	-3.36%	-2.81%	5.41%	64.92%	3.9%	-7.18%	23.12%	5.83%	-14.43%
Stockholders Equity	82,327	73,733	73,733	56,950	62,146	50,672	63,090	65,339	90,488	107,147	134,047	128,249
Equity Growth Rate	-2.8%	0%	29.47%	-8.36%	22.64%	-19.68%	-3.44%	-27.79%	-15.55%	-20.07%	4.52%	7.45%
Return on Invested Capital (ROIC)	44.16%	70.14%	70.14%	58.96%	54.98%	57.15%	49.56%	31.43%	29.21%	25.86%	18.21%	20.11%
After-tax Operating Income	79,039	112,281	112,281	93,532	97,477	100,083	94,456	56,724	53,737	57,894	46,280	44,684
Income Tax Rate	18.03%	15.61%	15.61%	24.09%	14.72%	16.2%	13.3%	14.43%	15.94%	18.34%	24.56%	25.56%
Invested Capital	189,685	160,071	160,071	158,645	177,310	175,127	190,581	180,480	183,954	223,883	254,216	222,196