Financial Analysis



Financial Analysis

Overview of the topic

You have just graduated from Keiser University's MBA program and have secured a position as a fund manager for a well known investment banking house. You have been given $300 million to manage/invest. The fund is a pension/retirement fund so its perspective is long term with moderate risk of loss of capital and a required return of 9% per annum. In order to reduce the investment risk you are instructed to make 12 investments of $25 million dollars each. The first assignment is to determine if the fund you are managing should invest $25 million dollars in the stock of the company you have selected for your first analysis/investment decision. The decision to invest or not invest will be supported by the research paper and a 12 to15 minute presentation to the Executive Committee of the Fund. Therefore, all the issues related to Financial Analysis will be discussed in detail.

Business Strategy Analysis

The company where a person is working is a Fund Management firm. The firm needs to prepare suitable competitive strategies in order to perform well in their business operations. There are three generic competitive strategies which are known as low cost provider, differentiation, or focus strategies that matters for any business. In the case of this firm, it would adopt a focus strategy by assessing the investment opportunities for the firm. The fresh graduate who is working this firm will try to offer the best investment offer to his client. The employee will make an investment in the famous IT firm known as Apple Incorporation. Therefore, this is the Business Strategy Analysis.

Accounting Analysis

Current performance of the company and its future strategies can be identified by analyzing the financial statement of the company. Thus, income statement, balance sheet, and cash flow statement of Apple Inc is being used to analyze the financial performance of the company and to analyze its relationship with mission and vision statement. In addition to this, for in depth analyses ratios would also be used to understand the decision making process of the company in critical situations (Bushman, 2006).

Analyses of Balance sheet of Apple Inc

Apple Inc, has witnessed tremendous success since the time of its inception, however, in the twenty first century, company has managed to double its growth rate. For instance, in Year Company, total assets were $4750, and in year 2012, company has managed to increase its total assets by more than fifty percent as currently total assets of the company are $176,064. Thus, this considerable increase in the assets particularly current assets have enhance the financial structure of the company ,and has enable them to pay off majority of its short term liabilities (Maffett, 2011).

Moving forward, since company is in continuous expansion face, which has increased the level of investment in long-term assets, however, the positive aspect of this is that company has done most of the investment using its equity sources such as cash, sellable assets, and ...