Question

Write a summary paragraph on Apple's:

Liquidity and debt situation

Profitability

Answer 1

A guy has been picking apples all day up on a ladder. He hasn't picked every last apple, but night is coming and he is tired. He remembers the strange vision he had that morning when he looked at a bunch of grass through a sheet of ice he removed from a drinking trough. It looked like the world was melting, and then he dropped the piece of ice. He may or may not be falling asleep as he has these thoughts. He thinks of how he will dream about apples.

He's getting sick of harvesting apples – there are so many of them, and he has to be careful not to let them fall. If an apple falls, it has to be chucked into the heap to use for making cider. Those cider apples are considered almost worthless.

He imagines that these thoughts about worthless apples and dropping things will haunt his sleep. He wonders if it will be a long, deep sleep, like the hibernation of a woodchuck, or whether it will just be a normal "human" sleep.

Ratios (Summary)

• Annual Data
• Quarterly Data

Apple Inc., liquidity ratios

  

		Sep 30, 2017	Sep 24, 2016	Sep 26, 2015	Sep 27, 2014	Sep 28, 2013	Sep 29, 2012
	Current ratio	1.28	1.35	1.11	1.08	1.68	1.50
	Quick ratio	1.09	1.22	0.89	0.82	1.40	1.24
	Cash ratio	0.74	0.85	0.52	0.40	0.93	0.76

Source: Based on data from Apple Inc. Annual Reports

Ratio	Description	The company
Current ratio	A liquidity ratio calculated as current assets divided by current liabilities.	Apple Inc.'s current ratio improved from 2015 to 2016 but then slightly deteriorated from 2016 to 2017.
Quick ratio	A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities.	Apple Inc.'s quick ratio improved from 2015 to 2016 but then slightly deteriorated from 2016 to 2017.
Cash ratio	A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities.	Apple Inc.'s cash ratio improved from 2015 to 2016 but then slightly deteriorated from 2016 to 2017.

Current Ratio

• Annual Data
• Quarterly Data

Apple Inc., current ratio calculation, comparison to benchmarks

  

		Sep 30, 2017	Sep 24, 2016	Sep 26, 2015	Sep 27, 2014	Sep 28, 2013	Sep 29, 2012
	Selected Financial Data (USD $ in millions)
	Current assets	128,645	106,869	89,378	68,531	73,286	57,653
	Current liabilities	100,814	79,006	80,610	63,448	43,658	38,542
	Ratio
	Current ratio1	1.28	1.35	1.11	1.08	1.68	1.50
	Benchmarks
	Current Ratio, Competitors
	Applied Materials Inc.	3.14	2.30	2.44	2.47	2.31	2.25
	Broadcom Ltd.	6.26	2.31	3.37	3.77	4.30	4.89
	Cisco Systems Inc.	3.03	3.16	3.23	3.39	2.95	3.49
	HP Inc.	1.00	0.98	1.23	1.15	1.11	1.09
	Intel Corp.	–	1.75	2.58	1.73	2.36	2.43
	NVIDIA Corp.	4.77	2.57	6.38	5.95	4.89	4.20
	Qualcomm Inc.	4.00	3.14	3.62	3.73	3.75	2.95
	Texas Instruments Inc.	–	3.29	2.77	2.92	2.92	2.40
	Current Ratio, Sector
	Technology Hardware & Equipment	–	1.80	1.73	1.66	1.91	–
	Current Ratio, Industry
	Technology	–	2.28	2.16	2.04	2.20	–

Source: Based on data from Apple Inc. Annual Reports

2017 Calculations

1 Current ratio = Current assets ÷ Current liabilities
= 128,645 ÷ 100,814 = 1.28

Ratio	Description	The company
Current ratio	A liquidity ratio calculated as current assets divided by current liabilities.	Apple Inc.'s current ratio improved from 2015 to 2016 but then slightly deteriorated from 2016 to 2017.