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Apple 2012 1Q financial analysis

Apple 2012 1Q results continues to impress. Revenue has jumped from 24,7 bn.$ to 39,2 bn.$ or by 59% compared to 2011 Q1. High revenue increase lead to even more rapid Net Income before depreciation increase. Which has risen from 6,4 bn.$ to 12,4 bn.$ or almost dubbed. This was lead by slower revenue cost (+43%) and operating cost increase (+36%) then revenue.

Companies sales by geography is good. 1/3 of sales are from US and 1/3 is from Asia which are the regions with highest estimated growth. Europe takes 22% of sales. Asia sales has dubbed compared to last year so this market has grown the most. Most of companies revenue is generated by iPhone 58% which sales has increased by +85%. Most rise was in iPad where revenue has increased by +132% and now contains 17% of companies income, this is a defiantly income growth segment while Mac and special y iPod (-25%) are the products of the past.

According to http://www.netmarketshare.com Apple share in mobile and tabled marked has increased from 48% to 60% and is better then its main competitors Google Android, which share has increased from 15% to 19%. But never the less big battle is projected in the future at this marked between Google and Apple. In general companies results are positive.

 Balance sheet continue to be very strong. Equity level has increased to 68%. That did not effect high return on Equity level which is 45% at Q1. Since company announced dividend payments and share repurchases companies Equity should not increase in the future. Liquidity ratio is 1,6 which is good. Company has cash surplus of 110 bn.$ which has increased from 97 bn.$ from Q4.  Companies inventory and Account receivables are minimal so as liabilities.

No other major changes at the balance sheet. In general companies balance structure is strong.

Share value:

Common Stocks 14,9 bn.$  0,935 bn. 15,9 $
+ Retained earnings 87,1 bn.$ + 93,2 $ 109,1 $
+ 1 year Net income before Depreciation 41,1 bn.$

(52 bn.$)

+ 44,0 $

(+55,6 $)

153,1 $

Companies share basic value is ~109$ (Δ+13,5%/96$ compared with Q4).  Current market price is ~610$  (Δ+12,1%/544$). which shows that market is paying ~500$ more or 11,4 years of Net income before Depreciation earnings, which shows that companies shares are a bit over evaluated. If calculating Net income before Depreciation according to last quarter yearly earnings should be around 52 bn.$/year (13 bn./quarter) or 55,6$/share which makes it ~9 year, never the less indicator is quit high. Share profitability (Share market price/Net income before Depreciation) if calculating projected income (52 bn.$/year) is 9,1% which is a bit over average.

Company announced that it will pay 2,65$/share/quarter dividend or ~1,7% dividend yield which is a bit low due to high share price.

Analysis source: Apple 2012 1Q financial results

Previous analysis: Apple 2011 4Q financial analysis

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