Company Analysis Apple

Table of Contents

Introduction3

Discussion4

Current Financial Health of Apple4

Industry Analysis13

Company's Position in Industry16

Investment Feasibility in Bonds of Apple17

Ability to fulfill Liabilities19

Conclusion20

Company Analysis Apple

Introduction

Investing in a company requires careful assessment of the company past and current performance and a careful foresight into the future of the company. The company has to be able to meet its liabilities and should have a history being successful. More importantly the growth of the company should be sustainable so that the risk of investment loss is low. It is very critical that the choosing company provides higher return on investment, should have higher bond yield, and is able to pay its investors. The company we have selected is United States based computer equipment manufacturer Apple Inc., commonly known as Apple. Apple is involved in the conceptualization, design, manufacturing and development, sales and marketing of range of computer technology devices, from personal computers, cell phones, multimedia players, and portable tablet devices. The company is intensively involved in the designing and development of computer software, third party digital content, other peripherals and services. The company is headquartered in California, United States, provides employment to 63,300 people as of 2011. Apple posted revenue of $156.51 billion on fiscal year ended on September 2012 which is an increase of 44% over the revenue of the same quarter in 2011(Forbes ,2012). The gross profit was reported as $68.66 billion, which is more 100% increase over the gross profit in September 2011. The return on asset was reported to be 23.61% while the return on Equity to be 42.84% (Yahoo Finance, 2012). The stock price Beta is 0.93 which shows that the stock of the company is a strong contributor to the index and is less susceptible to day to day trading. This paper will evaluate the companies and the industry in which it operates and will make recommendation for long term investing in this company.

Discussion

This paper will assess Apple's financial stability and the trends in the financial position of the company. Besides looking at the finances, the company's internal and external environment will be evaluated using SWOT matrix. This paper will also assess the future of the company.

Industry analysis forms key criteria in the long term financial investment. Investment in Apple means investment in the personal computer and equipment manufacturing industry. The investors will be have to look at the industry's scope and future trends and will have to decide if the investment in this industry will yield is feasible.

Current Financial Health of Apple

For the past years, Apple Inc has seen remarkable increase in its revenue. From 2007 to 2012, the company's revenues have jumped from $37.5 billion in 2007 to $185.3 billion in 2012 where as the industry growth figures dictate that Apple could have been grow by $6 billion only (Forbes, 2012).

Figure 1: Apple Inc. Financial performance, Source (IBIS World Website).

In 2009, when the overall consumer electronic industry was going through difficult times, Apple was able to increase its revenues by ...