Due tomorrow morning and here is my Module 1 assignment to use for module 4 SLP. Apple Financial Analysis Trident University Adeyemi Olatunji Module 1 SLP FIN 501 Dr. Michael Aubry May 21, 2017 Apple Financial Analysis             Apple Inc. is a premier company that deals with the design, production and marketing of computers, mobile phones and third party applications, and software. The company’s products include the iPhone, pad, and mac. The company’s operating system software include as is, OS X, watches, and those ("Apple - Annual Report", 2015). Other products include; the Apple TV, iPod and the Apple Watch. Apple’s target market includes the government, midsized businesses and other enterprises. Apple is one the best performing companies in the tech industry as shown by its financial ratios that indicate the financial health of the company. Recent Financial Performance             To efficiently evaluate Apples financial condition I analyzed its financial statements and used the values in the statements to calculate the financial ratios for the last three years. After performing an incisive analysis of the company’s financial statements by calculating various measures and comparing them to the industry benchmarks such as the S&P index it is evident that the company is financially strong and performing better than its peers in the industry. Current financial Health             There are various ratios and techniques that can be used to analyze Apple’s current financial health. These measures can be categorized into liquidity, profitability, asset management and debt ratios. The ratios measure the performance, rate of growth, efficiency and the financial condition of the company as discussed below Liquidity ratios             The current ratio measures the solvency and liquidity of an entity. It is calculated as current assets divided by current liabilities (Khan, & Jain, 2007) . Apple Inc.'s current ratio increased from 2014 to 2015 and from 2015 to 2016. The quick ratio is also another liquidity ratio that measures the ability of a company to meet its most current obligations. The steady increase in the liquidity ratio indicates that Apple has improved it is ability to meet its obligations. LIQUIDITY RATIOS 2014 2015 2016 Quick ratio 0.67 0.72 1.04 current ratio 1.08 1.1 1.35 Financial Value The price to earnings ratio is used to calculate the financial value of a company. The Price to earnings ratio   can be interpreted as the length of time in years a company takes to recover the price paid for the stock. It values the company by measuring the current share price in relation to the earnings per share. The price to earnings ratio is calculated as; Market Value per Share / Earnings per Share. Apple’s Price to earnings ratio has been on the rise for the last couple of years but reduced slightly in the last fiscal year. The price to cash flow is also other ratio used in valuation of a company. According to the t.

1. Due tomorrow morning and here is my Module 1 assignment to
use for module 4 SLP.
Apple Financial Analysis
Trident University
Adeyemi Olatunji
Module 1 SLP
FIN 501
Dr. Michael Aubry
May 21, 2017
Apple Financial Analysis
Apple Inc. is a premier company that deals with the
design, production and marketing of computers, mobile phones
and third party applications, and software. The company’s
products include the iPhone, pad, and mac. The company’s
operating system software include as is, OS X, watches, and
those
("Apple - Annual Report", 2015).
Other products include; the Apple TV, iPod and the Apple
Watch. Apple’s target market includes the government,
midsized businesses and other enterprises. Apple is one the best

2. performing companies in the tech industry as shown by its
financial ratios that indicate the financial health of the
company.
Recent Financial Performance
To efficiently evaluate Apples financial condition I
analyzed its financial statements and used the values in the
statements to calculate the financial ratios for the last three
years. After performing an incisive analysis of the company’s
financial statements by calculating various measures and
comparing them to the industry benchmarks such as the S&P
index it is evident that the company is financially strong and
performing better than its peers in the industry.
Current financial Health
There are various ratios and techniques that can be used
to analyze Apple’s current financial health. These measures can
be categorized into liquidity, profitability, asset management
and debt ratios. The ratios measure the performance, rate of
growth, efficiency and the financial condition of the company
as discussed below
Liquidity ratios
The current ratio measures the solvency and liquidity of
an entity. It is calculated as current assets divided by current
liabilities
(Khan, & Jain, 2007)
. Apple Inc.'s current ratio increased from 2014 to 2015 and
from 2015 to 2016. The quick ratio is also another liquidity
ratio that measures the ability of a company to meet its most
current obligations. The steady increase in the liquidity ratio
indicates that Apple has improved it is ability to meet its
obligations.
LIQUIDITY RATIOS
2014
2015

3. 2016
Quick ratio
0.67
0.72
1.04
current ratio
1.08
1.1
1.35
Financial Value
The price to earnings ratio is used to calculate the financial
value of a company. The Price to earnings ratio can be
interpreted as the length of time in years a company takes to
recover the price paid for the stock. It values the company by
measuring the current share price in relation to the earnings per
share. The price to earnings ratio is calculated as; Market Value
per Share / Earnings per Share. Apple’s Price to earnings ratio
has been on the rise for the last couple of years but reduced
slightly in the last fiscal year. The price to cash flow is also
other ratio used in valuation of a company. According to the
table below the ratios reduced from 2014 to 2015 then rose
again. The ratios indicate that Apple is a highly valuable
company. The ratios are small implying that it takes less time to
recover the money paid for the company’s stocks.
MARKET VALUE RATIOS
2014
2015
2016
Price to earnings
17.1
11.4

4. 13.9
Price to cash flow
11.3
7.5
9.7
Profitability ratios
The measures used to determine Apples Inc. level of
profitability include the return on equity, return on assets and
basic earnings power. The rate on return on equity measures the
percentage of earnings gained from equity financing while the
return on assets measures the level of income from the assets
investment. Basic earnings power is calculated as a ratio of the
EBIT to total assets. As shown in the table, the profitability
increased from 2014 to 2015 then dropped in 2016.This could
be as a result of a drop in revenues in 2016.
PROFITABILITY RATIO
2014
2015
2016
Return on equity
33.61
46.25
36.9
return on total assets
0.83
0.89
0.7
basic earnings power
0.24
0.23

5. 0.19
Asset management ratios
These ratios measure the efficiency of the company’s assets and
inventory. From the ratios in the table below it is evident that
the company is efficient in its performance.
ASSET MANAGEMENT RATIOS
2014
2015
2016
Inventory turnover
53.31
60.56
61.68
Total assets turn over
0.89
0.41
0.35
Fixed assets turn over
9.82
10.85
8.71
days sales outstanding
34.86
26.31
26.66
Debt ratios
Debt ratios measure the proportion of the company’s assets
financed by debt. I calculated the EBITDA coverage which
measures the company’s ability to service debt, time interest
earned and the ratio of the total debt to total assets. Apple has

6. low debt ratios which indicate that the company is in a position
to meet its debt obligations.
DEBT RATIOS
2014
2015
2016
EBITDA coverage
1.39
0.99
0.42
Time interest earned
1.38
0.98
0.42
total debt to total assets
0.15
0.22
0.27
From the analysis above, I would definitely buy apples stocks
if I were an investor. This is because the company is profitable
and has a high rate of earnings per share, The company’s bonds
are also a sure thing to invest in .This is because apple is rated
by the S&P INDEX as AA+ which implies that the company has
a high rate of credit rating which means that the probability of
default by the company is low. The bonds have a low rate of
interest which is expected to remain low in the future hence low
risk. The returns expected from the bonds are a high making
them a feasible investment venture.
Conclusion
In conclusion apple’s performance and current financial health
and its well financial value reduce slightly in the last fiscal year
.However, the company performs better in the industry than its
peers therefore it is a viable investment venture. When

7. compared to the industry’s benchmarks and indices the company
exhibits a strong financial position.
References
Apple - Annual Report
. (2015).
Investor.apple.com
. Retrieved 18 May s2017, from
http://investor.apple.com/secfiling.cfm?filingid=1193125-15-
356351
Khan, M., & Jain, P. (2007).
Financial management
(1st ed.). New Delhi: Tata McGraw-Hill.
Quote, A. (2017).
Apple stock quote, NASDAQ:AAPL summary
.
Amigobulls.com
. Retrieved 18 May 2017, from
https://amigobulls.com/stocks/AAPL