How does the Brexit Apple? -


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Wednesday, 29 June 2016

How does the Brexit Apple?

The referendum has taken place in the UK, in consultation with the population if they wanted to leave or not the European Union was expected to obtuviese result in a resounding no. But to everyone 's surprise, the resolution of the population was very contrary approving the departure of the European Union.

What provoked the consequent drop in markets with a large drop in value of the pound and were shocked markets. So you can expect that this has also affected the company on the block.

The Brexit and Apple

The Brexit helped Apple shares were thrown downhill to 2.8%, representing a devaluation of its value going to be worth $ 96 to $ 93.40. However, Apple shares ended much better than many of its competitors.

The NASDAQ stock market (where Apple shares traded) has dropped more than 4% overall. Amazon, Microsoft and Google have seen their shares have fallen between 3.2 and 3.95 (%).

This probably says more about the overvaluation of other technology firms. Apple is currently valued with ratio P / E (price / earnings) of 10.39, while Google is valued at 28.44 times earnings, Microsoft at 38 times earnings and Amazon has - surprisingly - valuation of 287.73 times its current capacity to raise cash.

The British pound has fallen against the US dollar, down from $ 1.50 to $ 1.37, the biggest drop in thirty years. The Euro has also been dropped, but much lower (about 3% against the dollar). Changes in the value of the currency affects the export prices of Apple, so the fall of any currency against the dollar usually pose a problem for the company on the block.

Apple in the UK

Apple has its main base of European businesses in Cork, Ireland. However, it has offices in the UK, including a corporate office and R & D center in Cambridge, along with the hiring of several employees and the purchase of a new company.

In addition, Apple has 39 physical stores in the UK, and generates significant sales region for the company. A significant drop in the pound means that people in the UK have less purchasing power, presumably this will result in an increase in prices and a drop in demand for Apple products and services.

For against, this can be increased procurement or the proliferation of Apple Store on the ground in the UK.

We can make clear that Apple will have two options: make the most of the devaluation of the pound for benefits or take drastic measures and increase the price of their products to match them to other countries.

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