Question
In: Finance
Regarding Apple Inc Imagine that you are a financial manager researching investments for your client. Use...
Regarding Apple Inc
Imagine that you are a financial manager researching
investments for your client. Use the Strayer Learning Resource
Center to research the stock of any U.S. publicly traded company
that you may consider as an investment opportunity for your client.
Your investment should align with your client’s investment goals.
(Note: Please ensure that you are able to find enough information
about this company in order to complete this assignment. You will
create an appendix, in which you will insert related information.)
Select any five (5) financial ratios that you have learned
about in the text. Analyze the past three (3) years of the selected
financial ratios for the company; you may obtain this information
from the company’s financial statements. Determine the company’s
financial health. (Note: Suggested ratios include, but are not
limited to, current ratio, quick ratio, earnings per share, and
price earnings ratio.)
Solutions
Expert Solution
Studying the stock Apple Inc (symbol: AAPL) listed on Nasdaq.
Attached is the excel sheet with the below ratios for the last three years. Calculated the below ratios:
- Current ratio
- Quick ratio = (Current assets - Inventories)/Current liabilities
- Net profit margin = Net income/Sales
- Return on Assets (ROA) = Sales/Total Assets
- Return on Equity (ROE) = Total Assets/Total Shareholder's equity
Observation:
All ratios decrease except the ROE. There is no major or huge % change in the ratios. Also its beta is 1.2 (source: yahoo finance) which is a good parameter for risky investors who look potential returns in the bull market.
Analysis:
The ratios NPM, ROA, ROE of Apple Inc., are above than that of industry average, which are 9.49%, 10.04%, 14.07% respectively
Other information:
- With increasing demand for the Apple products, Sales growth is seen positive in the coming years
- Market leader in the mobile phone industry
jeff jeffy answered 2 years agoRelated Solutions
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