Assignment 2: Financial Investments Of Your Relatives
Assignment 2 Financial Investmentsone Of Your Relatives Has Come Into
One of your relatives has come into a significant amount of money recently, and wants to invest $100,000 dollars in a stock that is listed either on the New York Stock Exchange (NYSE) or the NASDAQ. This relative has asked you to recommend three stocks that can be held for a while to maximize earnings, and will choose from one of the three you recommend. You have agreed to do some research and provide the recommendations. You may use financial services sites to find three stocks you like (for instance, Wal-Mart, FedEx, and Microsoft). In an MS Word document, write up your recommendations and your rationale for each.
Your recommendation should include: The name of the stocks and their stock symbols, the exchange where the stocks are traded, the 52-week range (high/low price), the lowest amount each stock has traded in the past year, the highest amount each stock has traded, the amount each stock closed on the previous business day, and the price-earnings ratios (P/E). Your reasons for recommending these stocks should also include the pros and cons of each.
Paper For Above instruction
Investing wisely requires thorough research and consideration of various financial indicators to maximize returns. In this report, three stocks listed on major U.S. exchanges, specifically the NYSE and NASDAQ, are selected based on their recent performance, potential for growth, and financial ratios. The chosen stocks are Apple Inc. (AAPL) traded on NASDAQ, Walmart Inc. (WMT) traded on NYSE, and Microsoft Corporation (MSFT) also traded on NASDAQ. These companies are industry leaders with diverse market sectors, providing a balanced approach for an investor aiming to maximize earnings over time.
Apple Inc. (AAPL)
Apple is a leading technology company renowned for its innovative consumer electronics, software, and services. It trades on NASDAQ and has consistently demonstrated strong financial performance. Over the past year, Apple’s 52-week range has been between $124.17 and $179.61. The lowest price at which Apple traded in the last year was $124.17, and the highest was $179.61. The stock closed at $177.57 on the most recent business day. Its P/E ratio is approximately 29, reflecting high investor confidence and growth prospects.
The primary reasons to recommend Apple include its robust ecosystem, continuous product innovation, and expanding service segment, which contribute to sustained revenue growth. Furthermore, Apple's strong brand loyalty and global presence support its competitive advantage. However, risks include market saturation, dependence on the iPhone product line, and potential macroeconomic impacts on consumer spending.
Walmart Inc. (WMT)
Walmart is one of the largest retail chains globally, with a diversified product offering across grocery, apparel, and household goods. Listed on the NYSE, Walmart’s 52-week trading range has been between $128.52 and $160.77. The stock’s lowest trading point in the past year was $128.52, and the highest was $160.77. It closed at $152.98 recently. Its P/E ratio is approximately 31, indicating solid profitability and market valuation.
Walmart offers stability and consistent dividends, making it an attractive choice for long-term growth with moderate risk. Its emphasis on e-commerce expansion and low-price strategy are positives for future earnings. Conversely, Walmart faces challenges from online competitors and thin profit margins in certain segments, which could affect its growth trajectory.
Microsoft Corporation (MSFT)
Microsoft is a technology giant specializing in software, cloud computing, and enterprise services. Traded on NASDAQ, Microsoft’s 52-week range has been from $213.66 to $349.67. The lowest trading price in the last year was $213.66, while the high reached $349.67. The most recent closing price was $338.39. Its P/E ratio is approximately 33, indicating high market expectations for future growth.
Recommended for its leadership in cloud infrastructure, productivity tools, and emerging AI technologies, Microsoft’s diversified revenue streams position it well for sustained growth. Challenges include regulatory scrutiny and intense competition in cloud services. Its strong financial position, innovative product pipeline, and strategic acquisitions support a positive outlook for investors looking to maximize earnings long-term.
Conclusion
Each stock offers unique advantages aligned with different investor risk profiles and growth expectations. Apple’s innovation and brand loyalty, Walmart's stability and growth, and Microsoft's leadership in cloud and AI provide compelling reasons to include them in an investment portfolio. Carefully monitoring market conditions, earnings reports, and industry trends will be crucial for maximizing returns and managing risks effectively.
References
- Apple Inc. (AAPL). (2023). Yahoo Finance. https://finance.yahoo.com/quote/AAPL/
- Walmart Inc. (WMT). (2023). Yahoo Finance. https://finance.yahoo.com/quote/WMT/
- Microsoft Corporation (MSFT). (2023). Yahoo Finance. https://finance.yahoo.com/quote/MSFT/
- U.S. Securities and Exchange Commission. (2023). EDGAR Filings. https://www.sec.gov/edgar/searchedgar/companysearch.html
- Morningstar. (2023). Stock Analysis and Data. https://www.morningstar.com/
- Yahoo Finance. (2023). Stock Market Data. https://finance.yahoo.com/
- Investopedia. (2023). Price-to-Earnings (P/E) Ratio. https://www.investopedia.com/terms/p/priceearningsratio.asp
- CNBC. (2023). Market Perspectives. https://www.cnbc.com/
- Bloomberg. (2023). Equity Research. https://www.bloomberg.com/markets
- Nasdaq Official Website. (2023). Market Data and Listings. https://www.nasdaq.com/