Question Details

(solution) 5 pages, APA format. Prompt: In this milestone, you will submit a

5 pages, APA format.

Prompt: In this milestone, you will submit a draft of the Risk Analysis section (III) and the Risk Management Strategies section (IV) of the final project. You will analyze the different risks that APPLE INC. faces and classify the risks (e.g., stand-alone risk, corporate risk, or market risk), which were discussed in Module One and more specifically in Module Five. You will also analyze the impact of these risks in regards to the company?s internal and external environments. Lastly, you will recommend risk management strategies that minimize the risk and maximize the return for APPLE INC. For example, you might think about whether the company should reduce its use of debt or seek short-term or long-term financing options instead. 
Running Head: INTRODUCTION AND FEASIBILITY OF APPLE INC. Final Project Milestone 1: Introduction and Feasibility of Apple Inc.


FIN 685: Risk Management


Emily Wong Yien San Prof. Scott Gillman


Southern New Hampshire University






Apple Inc. was founded on January 3,1977, by Steve Jobs and Steve Wozniak.


Together they have a strong vision towards the company, which is to change the way of


people perceived computers; they have successfully evolved computers to the size that is


small enough for people to be able to use them in their homes or offices. Today, the


company offers a wide range of mobile communication and media devices, computing


products and portable digital music players, and software products (Rawlinson, 2016).


A. Apple Inc. Size of Operation and Major Competitors


Direct Competitor Comparison 2015


AAPL HPQ GOOG Industry Market Cap: 576.24B 24.62B 528.88B 512.00M Employees: 110,000 287,000 66,575 895.00 -0.15 -0.53 0.21 0.16 220.29B 99.88B 81.76B 497.70M 0.39 0.24 0.62 0.30 73.96B 9.36B 26.90B 41.72M 0.29 0.08 0.26 0.06 47.80B 4.50B 17.99B N/A EPS (ttm): 8.58 1.88 25.81 0.37 P/E (ttm): 12.47 7.66 29.82 17.03 PEG (5 yr expected): 1.66 4.40 1.22 1.67 P/S (ttm): 2.63 0.25 6.47 1.00 Qtrly Rev Growth (yoy):


Revenue (ttm):


Gross Margin (ttm):


EBITDA (ttm):


Operating Margin (ttm):


Net Income (ttm): AAPL= Apple Inc. HPQ= Hewlett Packard GOOG= Google Alphabet Inc. INTRODUCTION AND FEASIBILITY OF APPLE INC.


A1. Historical Data




In Millions of USD


(except for per share






Other Revenue, Total


Total Revenue


Cost of Revenue, Total


Gross Profit 52 weeks ending


2015-09-26 52 weeks ending


2013-09-28 52 weeks ending


2012-09-29 233,715.00 170,910.00 156,508.00 - - - 233,715.00


140,089.00 170,910.00


106,606.00 156,508.00


87,846.00 93,626.00 64,304.00 68,662.00 HPQ


In Millions of USD


(except for per share




Revenue 12 months ending


2015-10-31 12 months ending 12 months ending




2012-10-31 103,355.00 112,298.00 120,357.00 - - - 103,355.00 112,298.00 120,357.00 Cost of Revenue, Total 78,596.00 86,380.00 92,385.00 Gross Profit 24,759.00 25,918.00 27,972.00 Other Revenue, Total


Total Revenue GOOGLE


In Millions of USD


(except for per share




Revenue 12 months ending


2015-12-31 12 months ending 12 months ending




2012-12-31 74,989.00 55,519.00 46,039.00 - - - Total Revenue 74,989.00 55,519.00 46,039.00 Cost of Revenue, Total 28,164.00 21,993.00 17,176.00 Gross Profit 46,825.00 33,526.00 28,863.00 Other Revenue, Total INTRODUCTION AND FEASIBILITY OF APPLE INC.


B. Leadership Position


Apple Inc. has a strong leadership position in the market presently and historically. Apple Inc. owns retail stores in 18 countries and online stores in 120 countries. The company generates over 500 billion revenue per year as compared to 497 competitors in the industry. It owns the market capitalization of $576 billion (Reuters, 2016).


C. Current Financial position




Market Cap: 576.24B Employees: 110,000 Qtrly Rev Growth (yoy): -0.15 Revenue (ttm): 220.29B Gross Margin (ttm): 0.39 EBITDA (ttm): 73.96B Operating Margin (ttm): 0.29 Net Income (ttm): 47.80B EPS (ttm): 8.58 P/E (ttm): 12.47 PEG (5 yr expected): 1.66 P/S (ttm):


Historical Financial Position 2.63 In Millions of USD


(except for per share




Revenue 52 months ending


2015-09-26 52 months ending 12 months ending




2012-09-29 233,715.00 170,910.00 156,508.00 - - - Total Revenue 233,715.00 170,910.00 156,508.00 Cost of Revenue, Total 140,089.00 106,606.00 87,846.00 93,626.00 64,304.00 68,662.00 Other Revenue, Total Gross Profit INTRODUCTION AND FEASIBILITY OF APPLE INC.


C. Product Line


Apple Inc. engages in designs, manufactures and promotes mobile communication


and media devices, personal computers and portable digital music players and sells a


wide range of related software, services, networking solutions and third-party digital


content and applications. The company main products are IPhone, IPad, Mac, Apple TV


and IPod; but most of all, Mac is an essential part of Apple Inc., its music related


products, IPod and iTunes are the company?s most profitable segment (Reuters, 2016).


Apple Inc. Feasibility


A. Financial Ratio of Apple Inc.


Leverage Total Debt / Equity ratio Profitability Profit Margin 21.70% Operation Operating Margin 28.55% Solvency Current Ratio 67.12 1.31 B. Financial Ratio of Competitors




Total Debt / Equity ratio N/A Profit Margin 3.33% Operating Margin 8.11% Current Ratio GOOGLE 0.96 INTRODUCTION AND FEASIBILITY OF APPLE INC.


Total Debt / Equity ratio 4.90 Profit Margin 22% Operating Margin


Current Ratio 26.17%


5.43 C. Ratio Discrepancies between Apple Inc. and Competitors


From the data above we can see that the markets for Apple Inc. products and services


are highly competitive and challenged by its competitors in all areas of its business. This


is due to a large number of product introductions lately and rapid technological advances


that significantly increased the capabilities and use of mobile communication and media


devices, computers, and other electronic devices. Moreover, Apple Inc.?s competitors


who are also highly depend on the mobile device and computer sectors have aggressively


cut prices and lowered their product margins in order to increase or sustain market share.


As a result, the company?s financial condition and operating results can be undesirably


affected by all these factors mentioned above in the long run (CSI Market, 2016).


Being the lead player of the industry, Apple Inc. continues focusing on increasing its


market opportunities related to personal computers and mobile communication and media


devices. These markets are extremely competitive especially competitors are well funded


and experienced in the industry. The company also expects competition in these markets


to be more aggressive as competitors tend to replicate the features of many of their major


products and applications within their own products or, on the other hand, cooperate with


other players in the industry to the extend that they can fully compete with Apple Inc.




Apple Inc.?s future financial condition and operating results greatly depend on the


company?s ability to continue to promote and offer new innovative products and services


in each of the markets. The company believes that with its superior innovation including


IPhone, IPad, Mac and IPod, software like IOS, OS X and ITunes, online services, and


distribution of digital content and applications, the company will continue to have a great


potential in competing its competitors (Rosoff, 2015).


D. Strengths and Weaknesses of Apple Inc.


Considering from the ratios above, one of the major weaknesses of the company has


that high leverage and low solvency. Comparing to Google Inc., Apple Inc. is heavily


capitalized with debt and it has comparatively lower solvency in terms of current assets to


pay for its debts (Yoshikami, 2016).


Overall, Apple Inc. is a good company for investment since it is a lead player in all


the markets that it competes in and it has always been dominating the industry. Looking


at the performance of the company, Apple Inc. has showed a strong growth in the near


future. One of the biggest strengths of the company is has a strong marketing and


advertising capabilities, excellent brand reputation, vertical integration and massive line


of products in one ecosystem (Yoshikami, 2016).


Apple Inc.?s earnings growth in year 2015 signifies that these strengths balance out


the company?s competitive advantages, such as those weaknesses that I mentioned above.


Hence, new IPhone releases are always popular and it guarantees good sales by offering


substantial new features. For instance the latest product IPhone 6, it offers much larger


displays than previous models and a well-designed fingerprint reader that provides easy INTRODUCTION AND FEASIBILITY OF APPLE INC.


access from the lock screen. As a result, the device has made it into record-breaking sales


for the company in the first few quarters of its release (Price, 2016).


In near future, Apple Inc. will focus in producing new innovative products and have


some interesting opportunities to expand its product lines into IoT market and health


related gadgets. At least for another cycle, these factors are what investors should focus


on (Price, 2016). References


CSI Market. (2016). Apple Inc. Retrieved from


Price, C. (2016). Is Apple A Good Investment For Dividend Growth Investors? Retrieved






Rosoff, M. (2015). Apple's iPhone revenue is bigger than any other tech company's total


revenue. Retrieved from




Rawlinson, N. (2016). History of Apple, 1976-2016: The story of Steve Jobs and the


company he founded. Retrieved from




Reuters. (2016). Apple Inc. Retrieved from


Yahoo Finance. Apple. Retrieved from:




Yahoo Finance. Google. Retrieved from:




Yahoo Finance. HP. Retrieved from:




Yoshikami, M. (2016). 7 reasons Apple is a buy. Retrieved from INTRODUCTION AND FEASIBILITY OF APPLE INC.


Solution details:

This question was answered on: Jan 30, 2021

PRICE: $15 (25.37 KB)

Buy this answer for only: $15

This attachment is locked

We have a ready expert answer for this paper which you can use for in-depth understanding, research editing or paraphrasing. You can buy it or order for a fresh, original and plagiarism-free solution (Deadline assured. Flexible pricing. TurnItIn Report provided)

Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .

About this Question






Jan 30, 2021





We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.

You can also use these solutions:

  • As a reference for in-depth understanding of the subject.
  • As a source of ideas / reasoning for your own research (if properly referenced)
  • For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).
This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student.


Order New Solution. Quick Turnaround

Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.


Order Now