Analyze Apple Inc. using their financial statements below.
Horizontal Analysis of Income Statement and Balance Sheet
Prepare a three-year horizontal analysis of the income statement and balance sheet of your selected company. Discuss the importance and meaning of horizontal analysis. Discuss both the positive and negative trends presented in your company.
Ratio Analysis
Calculate the current ratio, quick ratio, cash to current liabilities ratio, over a two-year period. Discuss and interpret the ratios that you calculated. Discuss potential liquidity issues based on your calculations of the current and quick ratios. Are there any factors that could be erroneously influencing the results of the ratios? Discuss liquidity issues of competitive companies within the same industry.
Recommendation
Based on your analysis would you recommend an individual invest in this company? What strengths do you see? What risks do you see? It is perfectly acceptable to state that you would recommend avoiding this company as long as you provide support for your position.
Income Statement
Period Ending
Sep 28, 2012
Sep 23, 2011
Sep 24, 2010
Total Revenue
156,508,000
108,249,000
65,225,000
Cost of Revenue
87,846,000
64,431,000
39,541,000
Gross Profit
68,662,000
43,818,000
25,684,000
Operating Expenses
Research Development
3,381,000
2,429,000
1,782,000
Selling General and Administrative
10,040,000
7,599,000
5,517,000
Non Recurring
–
–
–
Others
–
–
–
Total Operating Expenses
–
–
–
Operating Income or Loss
55,241,000
33,790,000
18,385,000
Income from Continuing Operations
Total Other Income/Expenses Net
522,000
415,000
155,000
Earnings Before Interest And Taxes
55,763,000
34,205,000
18,540,000
Interest Expense
–
–
–
Income Before Tax
55,763,000
34,205,000
18,540,000
Income Tax Expense
14,030,000
8,283,000
4,527,000
Minority Interest
–
–
–
Net Income From Continuing Ops
41,733,000
25,922,000
14,013,000
Non-recurring Events
Discontinued Operations
–
–
–
Extraordinary Items
–
–
–
Effect Of Accounting Changes
–
–
–
Other Items
–
–
–
Net Income
41,733,000
25,922,000
14,013,000
Preferred Stock And Other Adjustments
–
–
–
Net Income Applicable To Common Shares
41,733,000
25,922,000
14,013,000
Currency in USD.
Balance Sheet
Period Ending
Sep 29, 2012
Sep 24, 2011
Sep 25, 2010
Assets
Current Assets
Cash And Cash Equivalents
10,746,000
9,815,000
11,261,000
Short Term Investments
18,383,000
16,137,000
14,359,000
Net Receivables
21,275,000
13,731,000
11,560,000
Inventory
791,000
776,000
1,051,000
Other Current Assets
6,458,000
4,529,000
3,447,000
Total Current Assets
57,653,000
44,988,000
41,678,000
Long Term Investments
92,122,000
55,618,000
25,391,000
Property Plant and Equipment
15,452,000
7,777,000
4,768,000
Goodwill
1,135,000
896,000
741,000
Intangible Assets
4,224,000
3,536,000
342,000
Accumulated Amortization
–
–
–
Other Assets
5,478,000
3,556,000
2,263,000
Deferred Long Term Asset Charges
–
–
–
Total Assets
176,064,000
116,371,000
75,183,000
Liabilities
Current Liabilities
Accounts Payable
32,589,000
23,879,000
17,738,000
Short/Current Long Term Debt
–
–
–
Other Current Liabilities
5,953,000
4,091,000
2,984,000
Total Current Liabilities
38,542,000
27,970,000
20,722,000
Long Term Debt
–
–
–
Other Liabilities
16,664,000
10,100,000
5,531,000
Deferred Long Term Liability Charges
2,648,000
1,686,000
1,139,000
Minority Interest
–
–
–
Negative Goodwill
–
–
–
Total Liabilities
57,854,000
39,756,000
27,392,000
Stockholders’ Equity
Misc Stocks Options Warrants
–
–
–
Redeemable Preferred Stock
–
–
–
Preferred Stock
–
–
–
Common Stock
16,422,000
13,331,000
10,668,000
Retained Earnings
101,289,000
62,841,000
37,169,000
Treasury Stock
–
–
–
Capital Surplus
–
–
–
Other Stockholder Equity
499,000
443,000
(46,000)
Total Stockholder Equity
118,210,000
76,615,000
47,791,000
Net Tangible Assets
112,851,000
72,183,000
46,708,000
Currency in USD.
Cash Flow
Period Ending
Sep 29, 2012
Sep 24, 2011
Sep 25, 2010
Net Income
41,733,000
25,922,000
14,013,000
Operating Activities, Cash Flows Provided By or Used In
Depreciation
3,277,000
1,814,000
1,027,000
Adjustments To Net Income
6,145,000
4,036,000
2,319,000
Changes In Accounts Receivables
(6,965,000)
(1,791,000)
(4,860,000)
Changes In Liabilities
9,843,000
8,664,000
8,302,000
Changes In Inventories
(15,000)
275,000
(596,000)
Changes In Other Operating Activities
(3,162,000)
(1,391,000)
(1,610,000)
Total Cash Flow From Operating Activities
50,856,000
37,529,000
18,595,000
Investing Activities, Cash Flows Provided By or Used In
Capital Expenditures
(8,295,000)
(4,260,000)
(2,005,000)
Investments
(38,427,000)
(32,464,000)
(11,075,000)
Other Cash flows from Investing Activities
(1,505,000)
(3,695,000)
(774,000)
Total Cash Flows From Investing Activities
(48,227,000)
(40,419,000)
(13,854,000)
Financing Activities, Cash Flows Provided By or Used In
Dividends Paid
(2,488,000)
–
–
Sale Purchase of Stock
665,000
831,000
912,000
Net Borrowings
–
–
–
Other Cash Flows from Financing Activities
(1,226,000)
(520,000)
(406,000)
Total Cash Flows From Financing Activities
(1,698,000)
1,444,000
1,257,000
Effect Of Exchange Rate Changes
–
–
–
Change In Cash and Cash Equivalents
931,000
(1,446,000)
5,998,000
Currency in USD.