Forecasting Stock Analysis: Apple

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Forecasting Stock Analysis

Apple Inc

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5/30/2014

1. Background of the company

Apple Inc.is an Americanmultinational corporationheadquartered inCupertino,California, that designs, develops, and sellsconsumer electronics, computer software, and personal computers. Its best-known hardware products are theMacline of computers, theiPodmedia player, theiPhonesmartphone, and theiPadtablet computer. Its consumer software includes theOS XandiOSoperating systems, theiTunesmedia browser, theSafariweb browser, and theiLifeandiWorkcreativity and productivity suites.

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Apple was founded bySteve Jobs,Steve Wozniak, andRonald Wayneon April 1, 1976, to develop and sellpersonal computers. It was incorporated asApple Computer, Inc.on January 3, 1977, and was renamed as Apple Inc. on January 9, 2007, to reflect its shifted focus towardsconsumer electronics.

2. Reasons for using specific error (MAD vs MSE vs MAPE)

The errors are because of the fact of the stock market regulations, in the stock market there is no readily available data they may be some times available so as to predict the perfect share price of a specific co. MAD, MSE Or MAPE is the name of the same thing that is being used to discuss the types of errors that the co is facing.

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3. Results for stock analysis

The stock analysis is the analysis of any co’s stock market analysis , this analysis is used to analyze the financial position of any co that is listed on the stock exchange , by stock exchange we mean the co’s that are listed co’s or there are shareholders who had invested in the co’s who are listed on the stock exchange, there are certain requirements that need to be met to be listed on the stock exchange , there are some fees that may be payable at the start to be listed on the stock exchange , these are the registration fees that need to be paid to be listed on a recognized stock exchange.

In stock exchange there are brokers who are known as the stock brokers that had the work to meet the buyers who want to purchase stocks or shares of a recognized co and sellers who wants to sell their shares to people so that they can get benefit from the investment that they had made in the stock purchase. The brokers brings close the buyers and sellers of the stock so that they don’t waste time in finding anyone.

There are many things that are bought and sold on a recognized stock exchange like there are sales and purchase of stocks, bonds, forward contracts and many other derivatives that are bought and sold on a recognized stock exchange. By stock we mean the shares of any co that is listed on the stock market, by bonds we mean the co liability contracts one can say that are to be repayable on the specific demand of the seller , there are also go government bonds that are also traded, by forward contracts we mean to hedge a certain foreign currency risk that are to be faced when the co translate their financial statements in the home currency, there are many types of risks that are faced on the translation of financial statements, so the co’s normally hedge their foreign currencies in advance that they don’t had to face any type of translation risk at the time of translation of financial statements.

There are many types of stock markets that are trading all over the world, stock markets are very good to the business class people as well as to the other people, they can easily buy and sell their stock or any other commodity so that they can benefit from the investment that they had made in certain commodities, they can realize their investments as they want to obtain cash whenever they need in any time in the future, the buyers and the sellers became very close by the help of the stock market.

4. Results for Revenue

For revenue the prediction is 37,472, this is the future forecast for the revenue that is being made with the help of the Naive model. This model is used to analyze the future price of the revenue of the co. This model is a good estimation technique that is used to predict the future price of the co’s anything like the share price, EPS or any other thing to predict their price.

Regression model is also used to predict the relationship between different variables , there are two types of variables dependent variable and independent variable, the dependent variable may be sales and the independent variable may be the cost of sales , so that to predict the relationship between the two, the regression analysis model can be used to predict their relationship, other variables except stock price , EPS and the revenue, other variables like Dividend per share(DPS) , Price earnings ratio(P/E) ratio can also be used as the other dependent and the independent variables that are being used in the regression analysis technique , in the given table the regression model had forecasts of 611.13 , 47,767.31 Million and 11.83 for different variables that are being used to predict the future aspects of certain variables.

. 5. Results for EPS

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Moving average model is used to predict the future estimates of a certain variable e.g. EPS, it is a statistical technique that is used to analyze the estimated future price of a variable by averaging out the all data that is available into sub data, by taking average of these data that is available , the variables estimates can be measured with sufficient proximity , in the table given the moving average the forecasts for different variables are 373.34 , 27,189.85 Million and 6.79 , this model is used as a good statistical technique , it is normally used with the time series analysis model to predict the fluctuations between different variables , by taking the average of different variables the prediction for their future estimates of different variables can be made.

If the data is out of order then this analysis is not so good as this analysis is not as good if the data that is being used for the estimate is purely updated so that the estimates can be made more good as compared to the other techniques, this model is a useful technique to analyze the future estimates of certain variables so that the statistical appraisal is of a good quality so as to predict the future estimated of different variables. In the table given the estimated forecasts for different variables like EPS is 561.02, 38,068.07 and 8.31 , this model is a good predictor of the different factors of different variables so that pure estimates of different variables can be made, if the data that is being used for the estimates is good then the estimates and the projections can be made more good as the data is purely updated, if the data is not updated accordingly then the estimates and the projections are not up to order that is being required by different co’s.

6. Summary and Conclusion

The conclusion that can be drawn from this analysis is that how the different models or techniques that are being used to predict the future estimates of certain different variables , different models as discussed above can be made to analyze the estimates or projection of different variables, different variables we mean the revenue, stock price, EPS, P/E ratio and many other different variables that are being analyzed to predict their estimated price or the projections of these variables can be made in the future. The future price of certain variables can be predicted with the help of these models, these models are widely being used by different co’s so as to predict the estimated future price, estimates or projections of certain different variables , the variables may change dramatically with the change in the environment in which the co is operating , the inflation factor is also a big factor in changing the prices of different variables, inflation is the increase in the price of certain different variables as the time passes, as the time progresses the future price of certain different variables can be changed because of the inflation effect as the price of different variables are changing with the time as because the world economies are not as that in the past , so this effect is also making a big impact in increasing the prices or the estimates of certain different variables, these variables should be adjusted according to the effect of the inflation, the inflation effect is an important effect in making the estimate projections of different variables, the different variables estimates are very difficult to predict without the help of these statistical techniques or models, these models are very useful to predict any relationship between different variables and to estimate their projections.

7. Forecast for this co

The forecast for this co’s revenue, EPS and the stock at the end of the next quarter is round about 590 to 600 stock price, the revenue estimation for the next forecast is 37,400 to 37,800 and for the EPS the estimated forecast is 8.40 to 8.60, these forecasts are totally based on the hypothetical assumptions and pure estimation techniques are used like the forecasting models are being used for these estimations, so the models are very important for the forecasting of any variable.