Financial Analysis of Apple Inc.

Financial Analysis

Contents
Introduction.................................................................................................................................................2
Part A..........................................................................................................................................................2
Question 1...............................................................................................................................................2
Question 2...............................................................................................................................................3
Question 3...............................................................................................................................................3
Part b...........................................................................................................................................................6
Question 2...............................................................................................................................................6
Question 3...............................................................................................................................................9
Question 4.............................................................................................................................................10
References.................................................................................................................................................11

Introduction
Apple Inc. is an America multinational company which is headquartered in Cupertino California.
The company basically deals in the development and the selling of the consumer electronics,
software and the online services. It gives the tuff competition to Amazon, Google and Facebook.
The current price of the Apple Inc. is $170.80. Below is the report which discusses mainly about
the rationale behind choosing the stock taking into consideration of all the factors. Further the
financial analysis is also carried out in terms of the financial ratios. The client chosen for this
report is one who is about to retire from his firm.
Part A
Question 1
The factors that are going to affect the buyer’s taste and preferences will affect the demand for
Apple Inc. The preferences may change because of the personal choice or the advertising. At
times the preferences of the customers can change and thereafter the demand can fall. In
alignment of the individual who is about to retire shall invest in the stock of the Apple Inc. due to
following reasons (Martin. 2017).
Since the company is the private limited company and the company is open to the public to
purchase the shares of the organization. Economic factors can affect almost all the elements of
the business may it be financial or non-financial. The impact of the exchange traded funds on the
Apple stock and since the stock is the biggest mover of the market. The services are considered
as the new founder of the forward movement of the Apple. Amongst the latest products the
Apple launched the HomePod which is equivalent to the Amazon Echo and Google home. Hence

these are the factors that affect the positioning of the Apple and thereafter have a greater impact
on the trades of the stock (Forbes, 2018).
Question 2
Apple Inc. is chosen by most of the investors because of the three simple reasons which are
capital return, valuation and growth. The first reason is the capital return and it’s basically
because the Apple pays out a 1.5% dividend yield which is more than any other giant and the
power of generating the balance of the cash is supreme in case of Apple. With the corporate tax
reform in place and a great quarter for the Apple the company is set to return a record amount of
capital in 2018. The current cash position of the company is $163 billion (Wallet Investor, 2018).
There is more in case of Apple Inc. despite the capital return. Due to the strong consumer
business where the average selling price of the consumer increased from $100 per unit to $796,
the stock is relatively cheap. The analysts expect the earnings to grow at the whooping rate this
year and an additional 14.6% next year. Therefore what more the one can accept form the
company like Apple Inc. the factors that affect the price of the stocks are sales of Iphone and
Mac book. The services provided by the Apple Inc. accounts for 18% of the revenue recorded in
the third quarter of the year 2018 and it will definitely provide the benefits to the individual who
is going to retire (Martin. 2017).
Question 3
Weng, B., Ahmed, M. A., & Megahed, F. M. (2017). Stock market one-day ahead movement
prediction using disparate data sources. Expert Systems with Applications, 79, 153-163.
In the opinion of the Weng, Ahmed and Megahed (2017) the stock prices analysis is done on the
basis of the case study. One of the expert in this case study was able to predict the movement of