R Programming Task – Olya Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

R Programming Task – Olya Case Solution

Problem 2.4

Part A

My family has the Apple stock due to the reason that Apple has been one of the best stocks in the market in last 20 years. Furthermore, the Apple stock allows investors to hold the stock for the longer period of time. It is because of the reason that Apple is a leading as well as a valuable organization, with strong brand equity, which provides competitive advantage to the company over its market peers. The stock price of Apple is at an attractive point of entry for the investors, because the demand for the new iPhones tends to lead towards the stronger profit returns over the period of time.

Furthermore, the balance sheet of the company is strong as compared to its market competitors in the similar technology industry. Moreover, the market that is served by the company, is far from saturated and the company is accelerating its efforts to remain the market leader with a commitment to the progressive policy on the returns of the shareholders. Hence, these reasons provide a strong basis of investing in the stock of the leading organization, i.e. Apple Inc.

In addition to this, the analysis of the company’s stock performance could help in evaluating whether it would be feasible and viable to hold the company’s shares or would it be better to sell the shares. The company’s past performance in the tech industry and the impact of global pandemic on the stock could help in having a better evaluation of the vulnerability of the stock price to the natural crises.

Part B

Taking under consideration the analysis of the returns calculated using R; it can be seen that the log returns of the stock of Apple is average. It might be because of the adverse effects of the global pandemic that have severely affected the stock prices of many companies throughout the world.

The information related to the market performance and productivity of the organization is of paramount importance when making the stock investment proposal. The stock investment proposal of Apple would help in raising money through the investment of the stock. The proposal must include the performance and the recent information of the company’s stock. The performance of the company is slightly affected by the global pandemic as the returns on share are below 1. Additionally, the annualized return on invested capital of Apple was 20.92 percent for the quarter ended in September 2020. Furthermore, the stock of the company is the good long term investment because of the strong market reputation and growth over the period of time, which in turn provides higher rate of return to the company’s shareholders. In addition to this, the company most likely pays annualized dividend of 3.08 dollar to its shareholders. Not only this, the stock of Apple is included in S&P 500 and it is also the large-cap stock which refers to the market capitalization of the size of the organization.(O'Shea, 2020).

Part 3

The log returns and the normal returns of the Apple stock are calculated using the R. The log returns and the normal returns are plotted to have a closer look over the patterns of returns. The core difference between the log returns and the normal returns is that the log returns are the continuously compounded returns; whereas, the normal returns are the weighted sum of the the portfolio constitutes’ simple returns.

In addition to this, the log returns of the Apple stock is above average, which implies that there is a slight variation in the price of the company’s stock over the period of time. On the other hand, the plot of the normal return on the stock of the company also shows that the returns are above average, which means that the investment in the Apple stock would return above average returns back to the investors. In the wake of the global crises; the above average normal returns on the Apple stock provide strong foundation of investment.

Moreover, the descriptive statistics of the log returns show that the maximum and minimum log return are:0.83 and -1.24, respectively. In the similar manner, the descriptive statistics of the normal returns show that the maximum and minimum log return are:1.29 and -0.71, respectively. Furthermore, the median log and normal return on the Apple stock are: 0.130 and 0.139,respectively.

Part 4

The analysis and evaluation of the recent performance and growth of the company in the highly competitive market show that it is worthy to invest in the Apple stock. It is because of the reason that the sales of the previous iPhone has declined as people are waiting for the new iPhone 12 to upgrade, the company has still grown profit returns and revenues and has never disappointed its investors or shareholders. Additionally, the company is commitment to the progressive policy on the returns of the shareholders.(Matt Whittaker, 2020).......................

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R Programming Task – Olya Harvard Case Solution & Analysis