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Sustainable Growth Rate Analysis For Apple

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Sustainable Growth Rate Analysis for Apple

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Sustainable Growth Rate: Apple
Background
Steve Wozniak and the late Steven Jobs founded a computer company in April 1, 1976, Apple Computers Inc. becomes a global leader in the sector of computer and mobile technology (Rawlinson, 2016). Today, the company specializes in a range of products including computer hardware and software, consumer electronics, and provides digital distribution. With over 120 online stores, as well as worldwide retail stores in different countries, Apple continues to portray commendable features of financial stability. The firm remains highly competitive relative to key rivals as Samsung, Dell, and Acer. The study analyzes the financial position of Apple in the last three years in terms of sustainable growth rate (SGR).
Sustainable growth rates: 2013-2016
The maximum growth rate that an organization is able to sustain without needing external financing defines the term ‘sustainable growth rate’ (investopedia.com, 2016). In this view, the measurement of return on equity assumes that a firm’s focus on maintaining a set capital framework pertaining to debt and equity. Further, there is an assumption that the firm seeks to increase revenues within its threshold, while maintaining a constant dividend payout ratio. The SGR provides an account of the frequency at which a firm attains growth with its own equity, without need for outside financing, and maintaining a self-sustained

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