1. APPLE INC.

APPLE INC. is a company that designs, manufactures and markets communication devices and
mobile media and personal computers, and sells a variety of software, services, accessories,
third-party digital content and applications. (Apple Inc. Form 10-k).

The value of Apple in the market is 821.5 billion dollars.

Products and services Software applications Operating systems

iPhone®, iPad®, Mac®, Apple iOS, macOS® watchOS®, tvOS ™,
Watch® iCloud®, Apple Pay®.
AirPods®, Apple TV®, HomePod
™
Fuente: Elaboración propia (Apple Inc. Form 10-k)

Mission: Apple offers the best personal computing experience to students, educators, creative
professionals and consumers around the world through its innovative hardware, software and
Internet solutions. With the commitment to make products of high quality and reliability.

Vision: To be considered by its clients and strategic partners as a viable option that offers
solutions and services based mainly on innovation, advanced technology, service and quality
that exceed their expectations, as well as the creativity they have when creating new products,
distinguishing themselves from the competition, so that its added value is unique.

Social responsibility of APPLE INC.

Accessibility It offers products and services of superior quality, satisfying the real needs of
users in case they present a disability.
Education Give products, support and opportunities to the schools that need them most.
Atreves of donations and with the implementation of a process that gives
professional learning.
Environment Low impact, In the same way that innovation is included in the materials from
which Apple products are manufactured, these are made of 100% recycled
aluminum, so the most advanced products are those that produce the least
environmental impact.
Inclusion and At Apple, we are not all equal. And that is your greatest strength. Take
Diversity advantage of the differences in what they are, what they have experienced
and how they think. Because to create products that serve everyone,
everyone must be included.
 Privacy Apple products are designed to protect the privacy, information of your user
and empower you to choose what you share and with whom.
Supplier Los productos de Apple se fabrican en todo el mundo, se trabaja con
responsibility proveedores, desde la minería hasta el reciclaje, para verificar que se
cumplan los requisitos de Apple, para las personas y las comunidades en
nuestra cadena de suministro. En 2018, se realizaron un total de 1049
evaluaciones de proveedores en 45 países.
Fuente: Elaboración propia con datos de www.apple.com.
Fuente: Apple Supplier Responsibility 2019 Progress Report

2. METHODOLOGY
2.1. PESTE ANALYSIS

POLITICAL FACTORS - LEGAL

Apple is a US computer technology company. It has clients and suppliers in many countries
worldwide, therefore, it can be affected by the political stability of some country.
Some problems of political stability are factors such as: political risk, national and international
legislation and the regulation of financial markets.
POLITICAL RISKS
According to the Political Risk Map of 2019 published by Marsh (world leader in insurance
brokerage and risk management), the growing geopolitical and geo-economic tensions are the
most urgent global risks at present, continuing tensions between the United States and China,
wars commercial, the Brexit and the changes in the Euro zone, the future of nuclear programs
of North Korea and Iran and the tensions between Russia and the West.
Grafico Risk map 2019
Fuente Marsh
NATIONAL AND INTERNATIONAL LEGISLATION
Both in the United States and in Ireland, where its subsidiaries are located, the company is
subject to taxes. The tax rate for economic and political conditions are subject to significant
changes. Changes in the income of different countries with their tax rate, as well as changes in
the valuation of deferred tax assets, and liabilities or changes in tax laws, may affect Apple's
future tax rates.
REGULATION OF FINANCIAL MARKETS
Due to the global nature of the company's business and investments, both national and
international, it is exposed to fluctuations in the market values of its investment portfolio and
credit risk. Credit ratings and investment prices may also be affected negatively by liquidity,
credit deterioration, financial results, economic risk, political risk, sovereign risk or other factors
that harm.
ECONOMIC FACTORS
These factors will allow to have knowledge about the economy that is developed and how it can
influence the company.
Some of the economic factors to consider for Apple are
Economic cycle
According to Carmignac's first quarter report, the United States is going through the first signs of
a slowdown, counteracted by President Trump's policy. The labor market has also shown the
first signs of stagnation, with a fall in the creation of jobs and an evolution of the hourly wage
that has gone from 3.4% to 3.2%. Even so, this rate continues to be high enough to reach
business margins and contribute to weak investment.
Fuente: Carmignac, Datastream, 04/2019

In France and Spain they are in greater economic dynamism, while in Italy the
sustainability of their public debt is questioned because they have limited capacity to make
their economy grow without reforms.

LEVEL OF DEVELOPMENT
According to the Office of the Human Development Report (OIDH) of the United Nations
Development Program (UNDP), the countries with the highest levels of development in
2018 The five countries that top the world ranking according to the HDI are Norway
(0.953), Switzerland (0.944), Australia (0.939), Ireland (0.938) and Germany (0.936). All
these countries have reached a prosperous economic state through employment and
exploitation of their natural and human resources

Fuente: Programa de las Naciones Unidas para el Desarrollo (PNUD)

SOCIAL FACTORS
This factor will provide information on cultural characteristics and the behavior of social
groups in different parts of the world.

INCOME DISTRIBUTION
The World Bank classifies the world's economies into four income groups: high, medium-
high, medium-low, and low. This classification is based on the gross national income (GNI)
per capita calculated according to the Atlas method. (i) The units for this measure and for
the thresholds are in current dollars of the United States.
Every 1 of July, they update the classifications. These change for two reasons:
In each country, the factors of income growth, inflation, exchange rates and demographic
changes influence GNI per capita.
2. To maintain the limits in dollars, which separate the classifications fixed in real terms,
they agree to inflation.
The new thresholds are determined at the beginning of the Bank's financial year in July
and remain fixed for a period of 12 months.
As of July 1, 2017, the new thresholds:

Fuente Banco Mundial

Among the countries with high income are Norway, Switzerland, the United States, Ireland
and Japan

HUMAN CAPITAL
According to UNESCO where it indicates that the countries with higher levels of
development, have a higher human capital, as well as a greater knowledge of the
technologies.
The capital increase determines the level of development of a society and encourages the
innovative spirit of a certain country. People with better training make the difference in
knowledge obtained as well as in the processes of research and development of positive
results.
Companies with high human capital will be better able to carry out innovative projects in
their R & D departments. In addition, it will be possible to obtain your own technology.

TECHNOLOGICAL FACTORS
 This factor will allow obtaining information about the countries that invest the most in
technologies.

PUBLIC EXPENDITURE ON R & D

Israel, South Korea and Japan are the countries that invest most in knowledge as State
policy, both countries allocate 4.3% of the total of what they produce, followed by Japan
(3.4%), Finland (3.2%), Austria (3.1 %), Sweden (3.1%), Switzerland (3%) and Denmark
(3%).
The progress of some of the countries in research and technology, such as Finland, which
has researched about learning and Norway has innovated in the treatment of waste.

Fuente OCDE

2.2. SWOT analysis of apple

STRENGTHS
 Technological innovation, R & D. Able to develop simple high quality products in its
handling with a very careful aesthetic component.
 Own operating system (IOS), used in all its product line.
 Diversity of electronic devices
 Global reach, Apple is a technological leader in all geographical areas
 Successful commercial strategy.
 The company sells its products around the world through its virtual stores.
 High quality product and unique design.
OPPORTUNITIES
 Expansion of the distribution network.
 Growth in the demand for tablets and smartphones.
 Creation of new product lines.
 It is not compatible with several software, printers and other devices.
 Appearance of new distribution channels

WEAKNESSES
 Weak integration with Microsoft Office makes your product line less attractive to
commercial companies.
 High price. Apple products are typically higher than the price of their competitors.
Consumers sensitive to prices tend not to consider Apple in purchasing decisions.
 It does not authorize licenses for the manufacture of clones and therefore has no
compatibility with other systems.

THREATS
 Google Android operating system.
 Strong sales increases in tablets and smartphones with Android system.
 Lower prices on desktop computers in brands with Windows system.
 The highly competitive market in which Apple operates can cause prices to fall and have
a direct impact on the company's revenues and profitability.
 The technology of the future could be completely different.

2.3. MODEL OF THE FIVE FORCES OF PORTER

The model of the five forces of Porter, considers that the profitability of the sector is determined
by five sources of competitive pressure. These five sources include three sources of horizontal
competence; the one coming from suppliers of substitute products, the threat of new incoming
companies and the established companies. They also include two sources of vertical competition;
the bargaining power of suppliers and buyers.
SOURCE: own elaboration

 Rivalry between the competitors of the sector

Apple faces strong competition in the market, as well as in hardware, software and relationships
with digital content providers. In addition, the company also shows the competition of prices,
competition, the reduction of the sale and the intention of the applications and the characteristics
of the products of the competition or alternatively, the collaboration among themselves to offer
solutions that are more competitive than those that currently offer.
 Bargaining power of customers
The company in its sector operates in two kinds of markets: the productive factors and the
products. In the markets of productive factors, the company buys raw materials, components,
financial resources and labor; in product markets that sell products and services to customers
(who may be distributors, consumers or other manufacturers). In both markets the transaction
creates value for buyers and sellers. Therefore, the way in which value is distributed in terms of
profitability depends on the economic power of each of them. The bargaining power of a company
face-to-face its customers also comes from two sets of factors: the sensitivity of buyers to the
price and the relative bargaining power.
Competition in the main markets of the smart phone sector (iPhone + iOS) is not as concentrated,
because it has its own distribution systems, which, the purchase percentage of its buyers is lower
and does not represent a higher cost to lose one. In addition, Apple, having very differentiated
and unique products, has bargaining power with its buyers, which is why it has the ability to
increase the price of its products in the market.
 Bargaining power of suppliers
The analysis of the determinants of relative power between the company in the sector and its
suppliers is analogous to the analysis of the relationships of these suppliers and their customers.
The key now lies in the ease with which companies in the sector can choose between the different
suppliers of a productive sector and the relative bargaining power of each party.
This factor can not be considered as a serious threat to Apple, because there are many
companies that are within the technology sector, therefore, companies tend to be more elastic
with respect to their suppliers.
The supplier companies depend mainly on large companies such as Apple, since it has a very
large market share, and generates large sales of electronic devices. That is why the benefits
obtained by the supply of materials necessary for the manufacture of the different Apple products,
reach even suppliers of Apple suppliers. This is because the business guarantee for their clients
is a guaranteed business for them.

 Threats of substitute products

The price that customers are willing to pay for a product depends, in part, on the availability of
substitute products. The absence of these, leads to buyers being comparatively price sensitive,
that is, the demand is inelastic with respect to the price. The existence of substitute products
means that customers can opt for these in response to an increase in the price of the product,
that is, that the demand is elastic with respect to the price.

 Needs that APPLE satisfies.

 Communication
 Web browsing (emails, social networks, etc.)
 Availability of Wi-Fi networks
 Sync with iTunes, App Store, iWatch
 Music
 Favorite calls
 Set tones
 Manage contacts
 Use iPhone in another country
 Convert videos
  Favorite calls

There are many substitute products easily available in the market, but Apple has done a
phenomenal job in marketing, advertising and marketing its products, generating in its current
customers and in the market, a perception of a value superior to that of its competitors. In other
words, Apple has generated greater economic value for its products than its competitors.
 Threat of entry of new competitors
If in the sector the return on capital invested is greater than the cost of capital, the sector will act
as a magnet for companies that are out. Unless there are barriers to the entry of new companies,
the rate of profit will fall to the competitive level. In this case, the new competitors can not enter
into the same conditions as the established companies. The size of the advantage of those
established over the entrants measures the height of the entry barriers, which determine the
extent to which the sector can, in the long term, obtain benefits above the competitive level.

3. EVIDENCIAS (Ratios financieros)

COURSE:investig.com
COURSE: investig.com

RATIO DE LIQUIDEZ
BALANCE GENERAL DE APPLE

COURSE: investig.com
WORK CAPITAL: indicates the ability of the company to meet its short-term obligations
𝑪𝑻 = 𝑨𝑪𝑻𝑰𝑽𝑶 𝑪𝑶𝑹𝑹𝑰𝑬𝑵𝑻𝑬 − 𝑷𝑨𝑺𝑰𝑽𝑶 𝑪𝑶𝑹𝑹𝑰𝑬𝑵𝑻𝑬
𝐶𝑇 = 131339 − 115929 = 15410
It can be seen that once APPLE has paid its liabilities it has 15410 resources left to operate.

CURRENT REASON:
𝑹𝑨𝒁𝑶𝑵 𝑪𝑶𝑹𝑹𝑰𝑬𝑵𝑻𝑬 = 𝑨𝑪𝑻𝑰𝑽𝑶 𝑪𝑶𝑹𝑹𝑰𝑬𝑵𝑻𝑬/𝑷𝑨𝑺𝑰𝑽𝑶 𝑪𝑶𝑹𝑹𝑰𝑬𝑵𝑻𝑬
𝑹𝑪 = 131339/115929 = 1.13
The capacity of suns that APPLE has to pay for 1 new sol is 1.13

PRUEBA ACIDA
𝑷𝑹𝑼𝑬𝑩𝑨 𝑨𝑪𝑰𝑫𝑨 = (𝑨𝑪𝑻𝑰𝑽𝑶 𝑪𝑶𝑹𝑹𝑰𝑬𝑵𝑻𝑬 − 𝑰𝑵𝑽𝑬𝑵𝑻𝑨𝑹𝑰𝑶)/𝑷𝑨𝑺𝑰𝑽𝑶 𝑪𝑶𝑹𝑹𝑰𝑬𝑵𝑻𝑬
𝑷𝑨 = (𝟏𝟑𝟏𝟑𝟑𝟗 − 𝟏𝟏𝟓𝟗𝟐𝟗)/𝟑𝟗𝟓𝟔 = 𝟑. 𝟖𝟗𝟓𝟑
PA = 3.8953: APPLE is in a position to pay all short-term liabilities without selling its merchandise.
4. BIBLIOGRAFIA

 Vasquez, J (2015). Analisis Estrategico de la Empresa Apple Inc. (Tesis de Maestría).

Universidad Zaragoza, España.
CONSULTAR EN:

 Apple Inc. (2018). FORM 10-K:

https://s2.q4cdn.com/470004039/files/doc_financials/2018/q4/10-K-2018-(As-Filed).pdf

 Informe de progreso 2019. (2019). Apple Supplier Responsibility 2019 Progress Report:
https://www.apple.com/supplier-responsibility/pdf/Apple_SR_2019_Progress_Report.pdf

 Investing.com. (2019). Apple Inc (AAPL):

https://es.investing.com/equities/apple-computer-inc-financial-summar

 Map of political risks 2019, Marsh:

https://www.marsh.com/pe/en/campaigns/political-risk-map-2019.html

 Management report-First quarter of 2019, Carmignac:

https://www.carmignac.com/es_ES/analisis-y-mercados/trimonial-informes/reforme-de-
gestion-primer-rimestre-de-2019-3073