Stock Symbol: AAPL
Listed on NASDAQ
Department of Finance and Real Estate
Florida International University
In partial fulfillment of the requirements of the course:
This report provides a financial quarterly trend analysis for Apple Inc. The U.S. based company (formerly Apple Computer, Inc.) is an American multinational corporation that designs and sells consumer electronics, computer software, and personal computers. The company's best-known hardware products are the Macintosh line of computers, the iPod, the iPhone and the iPad. Apple has been around since the mid- 1970’s, known by its former name. As of July 2011, Apple has 357 retail stores in ten countries, and an online store. It is the largest publicly traded company in the world by market capitalization, overtopping ExxonMobil by some $150 billion, as well as the largest technology company in the world by revenue and profit, worth more than Google and Microsoft combined. As of September 24, 2011, the company had 60,400 permanent full-time employees and 2,900 temporary full-time employees worldwide; its worldwide annual sales totaled $65 billion, growing to $108 billion in 2011. Apple Inc. stocks are publicly traded on National Association of Securities Dealers Automated Quotations (NASDAQ), under the symbol “AAPL”, which I will use to reference the company throughout the report. Our group chose to analyze AAPL for the following reasons:
* Apple’s remarkable success and recent extensive notoriety in the media. * We believe that studying the firm’s financial statements will give us valuable insights about Apple’s financial strategies, and help us become better managers at identifying, analyzing, and resolving financial problems. Trading information and financial statements for AAPL were obtained from various financial websites including: Yahoo Finance; finapp.forbes.com; and MSN Money. We chose financial information from these websites for AAPL’s closest competitor in the industry Dell Inc. We are using Dell’s ratios as industry benchmarks for the purposes of this report. Key financial ratios for both companies were computed for the four most recent quarters, and these form the financial trend comparison, and industry performance comparative financial analysis. In addition, we carried out a comparative SWOT analysis for AAPL and used this qualitative information, together with the quantitative data from the previously mentioned trend and industry comparative analyses, to provide recommendations to investors and lenders.
A. Financial Ratio Calculation and Analysis
Our team obtained income statements, balance sheets, cash flow statements, and trading information for AAPL AND DELL for the four most recent quarters (March 2011, June 2011, September 2011, and December 2011) from our three internet sources. These data were entered into excel spreadsheets which are included in Appendix A. A.2Ratio Computations
The following table is a summary of the results of the ratio computations for AAPL: AAPL: Key Financial Ratios
Liquidity Ratios| Q1| Q2| Q3| Q4| Annual|
Current RatioQuick RatioNet Working Capital RatioCurrent Liabilities to Inventory RatioCash RatioOperating Ratio| 1.922.214.171.1246.572.13| 1.751.42.193.024.502.05| 1.6126.96.36.1993.512.25| 1.5188.8.131.522.981.67| 1.5184.108.40.2062.981.95| Asset Ratios| Q1| Q2| Q3| Q4| Annual|
Inventory Turnover RatioFixed Assets RatioTotal Assets RatioAsset to Equity Ratio| 220.127.116.111.54| 18.104.22.1681.54| 22.214.171.124.52| 126.96.36.1991.54| 12.051.52.921.54|
Profitability Ratios| Q1| Q2| Q3| Q4| Annual|
Return on Assets RatioReturn on Equity RatioProfit Margin RatioBasic Earnings Power RatioEarnings per Share Ratio| .661.032.43.83640.63| .7188.8.131.52781.20| .651.012.34.76707.36| 1.161.812.82.131393.70| 2.934.562.582.023518.59| Debt Ratios| Q1...