The Apple Company Research Recommendation

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The Apple Company Research Recommendation

The Apple Company Research Recommendation

The Apple Company

Apple Company serves as the largest information and technology Company in the world regarding revenue and total assets, and it is the second-largest manufacturer of mobile phones. Established in 1976, the company deals with designing, developing and selling the computer software, consumer electronics, and if offers online services. Some of the reputable hardware products offered by the company include iPhone smartphone, Mac personal computer, iPad tablet computer, and the Apple Smartwatch. In 2014 November, Apple emerged as the largest PLC around the world in terms of total market capitalization. The total employee of the company total to 115, 000 as at July 2015. The company has 475 retail stores located in seventeen countries around the world. Currently, the company enjoys high brand loyalty, and it is regarded as the most valuable brand around the world that is valued at $118.9 billion.

The Industry

The smartphone industry size is valued at $376.7 billion, registering $1.01 billion, and the total annual shipments amount to 1.83 billion handsets. In overall the computer hardware and software industry is growing at 13% annually. However, the growth is relatively low compared to the past years growth of 15%. The main competitors in the Industry include Apple, Samsung and other companies that include Microsoft, Huawei, and Dell. In USA Apple, company has 40% of the total market share with it closest rival Samsung having the 28% market share. In the computer hardware industry, the leading companies are Dell, HP, and Apple. The computer technology industry is currently very competitive with new company’s emerging that offers high quality and low priced products, which is a marketing strategy used mainly by the Asian companies. The industry is mainly driven by innovativeness, marketing, and production of high-performance products. In overall, Apple dominates the industry, even though its dominance is slightly bowing down to the pressure from other world giant companies.

Apple Company Analysis

1. SWOT analysis of the Apple Company

Some of the strengths of the Apple Company include a strong brand image, effective innovation process, and high-profit margin. The company is on of the strongest brand around the world and therefore it is capable of profitable new products, due to its strong brand. On addition to this, the company has a strong capital base and strong global presence. SomeApple’s weaknesses include high selling price of its products, limited distributed network, and the company sales are limited to the high-end market. Some of the opportunities include distribution network expansion, the creation of the new product line, and rising demand for the smartphones and the tablets. On the other hand, some of the threats facing the market include stiff competition in the industry and rising labor cost that threatens to increase the cost of operations.

1. Recent Financial Performance

Apple Company has a sound financial performance over the years, in 2014, the income of the company grew by 6.68% and in 2015, and the income grew by 35.14%. This shows that the company has a strong sales generation ability and the ability to convert the sales into income. The total assets (capital) of the company grew by 125 in 2014 and 2015 in grew by 25.19%. This shows that the company is maximizing the value of the shareholders. Compared to the market average Apple performed relatively well. The average market growth was in 2015 was 23% with the total assets of the average company expected to grow by 12%. This means that the Apple Company performed above the average in both the years 2014 and the years 2015.  Compared to the Samsung Company, which is the closest rival in the smartphone industry which has turned to the key revenue sources for the Apple Company, the company performed slightly well (where Samsung Company registered 33.215 net income growth in 2015 and assets grew by 21.7%). The Apple Company is projected to have a sustained 7% growth for the next five years and the assets are expected to grow at an average rate of 15%.

1. Valuation

The analysis of the Apple company stock price reveals that it is relatively undervalued. Currently the company’s stock