Dupont Analysis Of Apple's Financial Leverace For Apple
925 Words4 Pages
A business’s financial leverage ratio represents how much of the company’s capital comes from debt. This is another way of assessing a business’s capacity to meet financial obligations. The following are calculations performed to determine Apple’s financial leverage:
Once the financial leverage has been calculated a return on equity (ROE) can be calculated using a DuPont Analysis. The following is a DuPont Analysis calculation of ROE for Apple:
A company 's financial performance can be measured by using economic value added (EVA). Economic profit is a performance measure between return on invested capital and the cost of capital, multiplied by the invested capital. This calculation is based on the relationship between the cost of capital and operating profit. The following is an EVA calculation for Apple:
According to the WACC calculation, Apple pays 7.56% on every dollar financed. This equals 7.56 cents per financed dollar. For every dollar that Apple spends on investments, they must make $.0756 plus the cost of the investment just for this to be practicable for the company.
Apple’s market value can also be calculated using the data listed above. Market value is calculated by multiplying the current number of outstanding shares by the current stock price. The following is a calculation of Apple’s market value.
Dividend Policy
A dividend is the declaration of return to shareholders. A company can be either private or public. Apple is a public
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