Contemporary Issues in Accounting: Apple Inc. Stock Performance Report

This report offers a comprehensive analysis of Apple Inc.'s stock performance, focusing on contemporary issues in accounting and financial markets. It examines the reasons behind share price fluctuations, including investor concerns about iPhone sales, the impact of pricing strategies, and broader market reflections. The report delves into investment strategies, financial analysis using key ratios like quick ratio, current ratio, and debt-equity ratio, and risk assessment, highlighting both the opportunities and potential challenges for investors. The analysis includes a recommendation for long-term investment, emphasizing Apple's innovation, product diversification, and global market presence, while also considering the risks associated with market dynamics and competition. The report is structured to provide a clear understanding of Apple's financial health and market position, offering valuable insights for potential investors and stakeholders interested in the company's performance and future prospects.

Running head: CONTEMPORARY ISSUES IN ACCOUNTING
Contemporary Issues in Accounting
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Table of Contents
Introduction................................................................................................................................2
Discussion..................................................................................................................................3
Share price..............................................................................................................................3
Investment Strategy:...............................................................................................................4
Financial Analysis..................................................................................................................5
Recommendation........................................................................................................................6
Conclusion..................................................................................................................................7
Reference:..................................................................................................................................8

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Executive Summary
The report is prepared on the Apple Inc. to review the stock price. The report also gives the
reason of falling of stock price. Further in the report discussion about the investment strategy,
financial reviews are provided for investment purpose. The report is concluded with the
recommendation about the company and whether to invest in the company or not.

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Introduction
In the year 1976, Steven Jobs with Stephen founded apple. The first product if the
company was the Apple I that was featured as a single-board computer along with on-board
read - only memory (ROM) in California. That was sold for the $650. This was not the
amount for the keyboard as well as monitor. In 1984, Apple presented the Macintosh that was
expected at the corporate and instruction markets, by that time the corporation had already
not simply transformed American industry but had redesigned complete regions of the West
everywhere silicon. In 1996, afterward a sequence of CEOs unsuccessful to retain Apple
money-making, Steve Jobs repaid below the rubric temporary CEO and rapidly hurled a new
advertising and certifying association with Microsoft. In 2000 his straight sales idea, the
Apple Store transported the business back to success.

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Discussion
Share price
After the announcement made by Apple regarding the decision of putting the stop to the sale
of particular unit for the products such as Mac, iPhone, as well as iPad that would be starting
from the next year. The price of the stock on the announcement date was $ 206.76 on
November 2018, the stock price on January 18th 2019. Was $ 156.60. The reasons of fall in
the share price are as bellow:
 Investors are worried about iPhone sales.
In the month of September Apple exposed a new for launching a new product. This was
an excitement of for the investors. The products that were shifted by the company was
almost moderate in the current quarter. The time when the Australian citizen purchase
stock the company dishearten their investors as well as customer by calling off the market
sell.
 Apple's increase prices might permission it bare if the economy curdles.
Response regarding the sale of smart phones had reduced due to increase in the price.
This has helped in generating more revenue in spite of contracts emerging in the industry.
The global as well as US growth is predictable to sluggish along with the data that has
been showed reflect mix expenditure.
 Investors doubtful with the service business of Apple`s
As Apple goals the revenue of $50bn by providing service on items Apple Pay, Apple
Music as well as Apple Store. As the company thought it to be huger user base.But
investors commonly motionless have a lot of queries. Investor’s takes an assumption that
Apple hasn't officially shared its strategies for television as well as big screen along with

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its objectives for infringement into the healthiness commerce also persist moderately
incomprehensible.
 Broader Market Reflection
The industry sector had a hard time. On November 1st the company gave an update to the
investor that the confusion left its shares comparatively untouched by contrast. The
makers of iPhone are under threat about the market that is inclusive of overly hopeful
estimates, increasing interest charges, exchange variation along with US-China trade
pressures. China, in specific, is a danger some are viewing for Apple, subsequently the
Greater China region – that is inclusive of Hong Kong as well as Taiwan being the source
of nearby 20 percent of the firm's proceeds. It also trusts on builders there, however its
products have been secure from pricelists so far. Mr Ives commented that it’s ‘a white
knuckle period’ for Apple, though he residues positive for the long-term fortune for the
company.
However on overall basis, Apple Inc. stock price has been kept on falling as it is still
modifying the new innovative gadgets. This would only add growth.
Investment Strategy:
As some investors has aim for investing in long term basis and on the other hand some
investors look forward for investing for quick and short gains. The investment strategy is
based on the investor’s choice as well as the performance of the company.
If the investor is ease at taking fluctuations in the stock price for long term gains. Some
investors believe in logic investment that mean following market trend and having small
gains. Mainly the strategy used by the investor is based on the amount of investing. One is
investing for growth as well as increasing the value while holding them for long term stage.
The analysts suggest Apple Inc. as the ideal investing company for long term investment.

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Financial Analysis
Before investing in the company an investor would like to know the basis of
recommendation from the analyst or from his broker. The recommendation on the company
for investing in a company is based on the analysis of the performance of financial statement
of the company. The recommendatory shall put his opinion regarding investing based on the
ratio analysis. While analysis of financial statement of Apple Inc. shows that quick ratio of
the company stood at 0.99 percent the quick ratio indicates about the liquidity, as compared
to past three years the ratio indicates good health of financials. Even current ratio (1.12
percent) indicates that the company can easily pay out its current debts. The earning per share
concludes the profitability as well as the achievement of the company. The positive EPS
indicated that the shareholders are earning by investing in the company. (Salinas, 2018).
Debt equity indicates the company strength for financing regarding assets. The
company`s debt equity stood at 0.87 percent means that company is creating additional debt
in order to finance asset. Apple Inc uses its sources in innovating its product so that potential
is added to the company`s growth. The EBIT also indicates about the financial strength.
Risk Analysis
As the company is more focused on adding innovation to its product. The investors
has the concern that the company may lose its momentum that happened with iPod. Even the
earnings of the company has been seen by selling of the smart phones but now the market of
smart phones had affected the fall in stock price. The only profit that is being earned by the
company is from adding innovation to its products. The analysts stated that investing in the
company would range the risk medium range by seeing the loyalty of the company towards
its consumers as well as to the ratios of the company. An investor can use diversification

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strategy to diverse it risks. This can be done through choosing the wide range of investment
in its portfolio. (Al Karim and Alam, 2013).
Recommendation
Apple Inc. is single of the principal rudiments builders that governor over the product
by expansion both PROCESSERS and their process system. It is recognised that the apple
corporation has a extraordinary Quality invention that brands the apple company unlike than
its participants. Apple generates its product with exclusive designs to appeal the customer
hallucination and upsurge its commercial since Apple accomplishment is grounded on
pleasing purchaser requirements. The apple company has solitary of the topmost variety
banners within the manufacturing production all over the earth, and more than 50 percent of
their proceeds are from worldwide market sections. The apple company is enthusiastic to
create new produces that would mark the use of manufacturing at ease and extra operative.
The apple corporation constantly affords easy-use invention to the small hand of the
consumers. Most of its merchandises are graceful, trivial, and transferrable everywhere which
mark them extra inexpensive. One of the countless belongings about the apple corporation is
invention diversification; the apple corporation has a ration of product assortments to pay
consideration to everybody on the earth. In totalling, there are numerous customers who are
enthusiastic to The apple corporation even nevertheless the values of The apple company
harvests are sophisticated analysing to its participants.
The investors can invest in Apple for long term. In the article from Eric Mc Whinnie.
It mentioned that the net income of the company was $ 20065 million in the last quarter as
compared to the income earned in the previous quarter. Revenue of the company has shown a
faster growth since three years. The author said that China is doing well as the deal with

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china had fetch Apple a greater network in the world wide. In the past time Apple and Google
were fighting for the first place. (Gaudard, 2015).
Conclusion
Apple has showed its sustaining conditions for a long period. Therefore the investors
can reinvest for its sustained in the market. Though, the company is highly valuable as well
as profitable company in the world wide. But its stocks are underestimated this is the reason
that it had been listed in the choice list of investments. The technology industry has ranked
Apple at the first position because of its innovation. Being the largest technology in the world
as well as the innovator, apple generate highest cash flow as compared to its competitor. This
indicated that the stock of the company is a growth stock.

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Salinas, S. (2018). Apple plunges into correction territory after shaking up its quarterly
reporting structure. [online] CNBC. Available at: https://www.cnbc.com/2018/11/02/apple-
stock-lower-after-major-shake-up-of-quarterly-reports.html [Accessed 20 Jan. 2019].
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