Research Report
Financial Analysis: Apple Computer Inc.
Summary:
This research conducted by the Yeo Bee Lin the student of Boston University at December 8, 2005. The research report based on the question that, Is Apple Computer Inc., (Apple) growth sustainable? In this is the research report the researcher used Apple’s Year 2005 (September 24, 2005) financial statements to analyze its business and financial sustainability in comparisons with the industry giant Dell, Inc (Dell) Year 2005 (January 28, 2005). Researcher also gave small introduction about these companies history their products, strengths in specific area.
Researcher gathers all the financial data of Apple and Dell for analyzing the business and financial performance for both companies, and used ratio analyses method to check the financial sustainability of both companies. In ratio analysis method the researcher considers and form conclusion on these matters; profitability, solvency, financial strength, trends and gearing cover.
Research concludes that investor should invest in Apple Computer Inc. Apple not only has strong financial stability, but also continues to invest in research and development to gain sustainable growth in the future. This research report also proven that Apple has strong operation teams to manage its costs and revenue generation. Further to its operation efficiency, Apple is currently rich in cash and short-term investments of $8,261 mil as of 24 September 2005. Apple is well managed in terms of its debt to equity measures. This company has sufficient Owners’ Equity, retained earnings to fund its future growth and Apple has managed to keep its liabilities in a comfortable level. Operation efficiency is one of the key success factors in supporting the company’s business strategies. Therefore, this company will still go strong for at least another two to three financial periods.