Apple - Financial Analysis
BRIEF GLANCE AT THE FY2005 RESULTS
In the fiscal year that ended September 2005, Apple reported revenues of US$13,931M, an increase of 68.3% over the preceding year. The Operating Income in FY2005 was US$1650M, an increase of 406.1% over the 2004 figure. Net Income also similarly increased by 383.7% in FY2005 to US$1335M.
Additionally, Total Assets increased by 43.49% to US$11,551M. Total Liabilities increased by 37.36% to US$4,085M, but Total Debt remained at US$0. Shareholders benefited in FY2005, as Shareholder's Equity increased by 47.08% to US$7,466M.
Several factors to explain the upward financial trend were the increase in net sales of iPods by US$3.2B, which was a 248% increase. Other music related products and services also had an increase in net sales of 223%. The company also experienced smaller increases in the net sales n retail, peripherals and other hardware, Macintosh computers, and software, services and other sales. There were no decreases in the net sales of all products, but Net sales per Macintosh and iPod fell due to new pricing strategies and the introduction of lower end products such as the iPod Shuffle.
FINANCIAL STATEMENT ANALYSIS RATIO ANALYSIS
SHORT TERM SOLVENCY APPLE SIC 3571 SIC 7352
Quick Ratio 2.91 1.058 2.86
Current Ratio 2.96 1.321 2.89
LONG TERM SOLVENCY APPLE SIC 3571 SIC 7352
Debt-Equity Ratio - 0.1172 0.01
Equity Multiplier 1.00 1.1172 1.01
ASSET UTILIZATION APPLE SIC 3571 SIC 7352
NWC Turnover 2.04 8.576 1.25
PROFITABILITY APPLE SIC 3571 SIC 7352
Profit Margins 0.0958 0.0033 0.26
Return on Assets (ROA) 0.1174 0.0045 0.14
Return on Equity (ROE) 0.1174 0.0055 0.16
MARKET VALUE APPLE SIC 3571 SIC 7352
Earnings per Share (EPS) 1.56 0.02 0.55
Price-Earnings Ratio 40.34 22.88 24.19
Market-Book Value Ratio 6.79 2.31 6.04
(SIC 3571 and 7352 industry averages denote the median of our sample companies.)
In our analysis, Apple's financial ratios are compared to two different industries because of
In the fiscal year that ended September 2005, Apple reported revenues of US$13,931M, an increase of 68.3% over the preceding year. The Operating Income in FY2005 was US$1650M, an increase of 406.1% over the 2004 figure. Net Income also similarly increased by 383.7% in FY2005 to US$1335M.
Additionally, Total Assets increased by 43.49% to US$11,551M. Total Liabilities increased by 37.36% to US$4,085M, but Total Debt remained at US$0. Shareholders benefited in FY2005, as Shareholder's Equity increased by 47.08% to US$7,466M.
Several factors to explain the upward financial trend were the increase in net sales of iPods by US$3.2B, which was a 248% increase. Other music related products and services also had an increase in net sales of 223%. The company also experienced smaller increases in the net sales n retail, peripherals and other hardware, Macintosh computers, and software, services and other sales. There were no decreases in the net sales of all products, but Net sales per Macintosh and iPod fell due to new pricing strategies and the introduction of lower end products such as the iPod Shuffle.
FINANCIAL STATEMENT ANALYSIS RATIO ANALYSIS
SHORT TERM SOLVENCY APPLE SIC 3571 SIC 7352
Quick Ratio 2.91 1.058 2.86
Current Ratio 2.96 1.321 2.89
LONG TERM SOLVENCY APPLE SIC 3571 SIC 7352
Debt-Equity Ratio - 0.1172 0.01
Equity Multiplier 1.00 1.1172 1.01
ASSET UTILIZATION APPLE SIC 3571 SIC 7352
NWC Turnover 2.04 8.576 1.25
PROFITABILITY APPLE SIC 3571 SIC 7352
Profit Margins 0.0958 0.0033 0.26
Return on Assets (ROA) 0.1174 0.0045 0.14
Return on Equity (ROE) 0.1174 0.0055 0.16
MARKET VALUE APPLE SIC 3571 SIC 7352
Earnings per Share (EPS) 1.56 0.02 0.55
Price-Earnings Ratio 40.34 22.88 24.19
Market-Book Value Ratio 6.79 2.31 6.04
(SIC 3571 and 7352 industry averages denote the median of our sample companies.)
In our analysis, Apple's financial ratios are compared to two different industries because of