Still has strong financial ratios and the outside

Info icon This preview shows pages 3–5. Sign up to view the full content.

View Full Document Right Arrow Icon
still has strong financial ratios and the outside environment will lend itself to growth and
Image of page 3

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
more revenue in the coming years. A competitor of Texas Instruments that we chose to invest in was Intel (INTC), and we were very happy to do so. Intel is the world's largest chipmaker based on revenue and unit shipments, and is well known for its dominant market share in microprocessors for personal computers. The following examples show how the company is very strong and dominates the industry, which were major factors in the process of choosing Intel. Intel is the leader in its industry and has a market capitalization of $139.39 billion. It has accomplished this by extending its leadership in key technologies that have provided competitive advantages, improving efficiency and profitability, which in 2010 was the highest in several years. . Intel's revenues are less variable than its competitors’ because of its competitive position, a fairly stable computing end-market, and the relative size of its revenues. For 2012, S&P Net Advantage forecasts 5.7% revenue growth, to $57.1 billion. In addition, the company provides a high dividend yield of 3%, making it an attractive and profitable stock to own. Another key strength is the company’s annual gross margins that have been in the mid-50% to mid-60% range over the past few years. In recent years, Intel has benefited from its superior operating margins of around 26%, on average, allowing it easily cover its fixed costs and pay off debts. Overall, the company is performing very well, and thus far, it has shown in my portfolio with a $24,000 profit. Another sector our company decided to invest in had been the sports apparel industry. According to the beige book, seeing how retail sales had gradually indicated increase throughout all districts, consumer spending seemed to improve as well. Expectations for the months ahead in terms of the retail industry appear solid. With this, we had determined that this industry would be a worthwhile field to invest in, as we selected retailers Nike and Lululemon. Being a publicly traded clothing, sportswear, and equipment company, Nike is a very stable company to invest in at the moment. In regard to environmental factors to a sports apparel industry, the company holds a massive amount of brand power. Having major sports endorsements, such as LeBron James, many investors find this as a key quality to have in a long-term investment. The quality of the company’s products is above standard for high prices, but the company is known for having a strong customer loyalty base, just as Apple does. Because Nike has been in operation for at least 30 years, this company can be perceived as a value stock. Nike has a P/E ratio of 23.33 and earnings per share of $4.79. Its return on equity is 22.59% and quarterly sales growth is 15.1% (“NKE: Summary”). Comparing the sports apparel industry’s technical analysis, Nike is relatively stable and has mainly increased during our period of investment. With a
Image of page 4
Image of page 5
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern