strengths, weaknesses, and challenges of Altium Limited
Executive summary
The purpose of the report is to evaluate the strengths, weaknesses, and challenges of Altium Limited. This report helps the company to foresee and plan in light of future opportunities and threats. The company is responsible for developing electronic software and hardware that is used in developing circuit boards. The company has a market capitalization of 3.78 billion, and its tools are used in various industries such as defense, semi-conductors, and anonymous vehicles. The company also has a variety of products ranging from designer 3D board, Altium concord pro, and tasking. Though the company i known for providing efficient and powerful user interface workflow, it has been faced by several challenges. These challenges include; connection to the pad or underneath SMD makes connection difficult, placing of connecting vias may lead to certain areas being cut, unconnected inner vias pads may weaken the physical holding cell, and lastly, grounding. Swot analysis is used to identify the company’s strengths, weaknesses, opportunities, and threats. The study proves that the strengths dominate the vulnerability, and the opportunities overlook the risks. The business valuation methods used are the residual earning model and the dividend discount model. The residual earning model which comes highly recommended takes into consideration the cost of capital and all costs that the company incurs, which makes it more effective than the traditional accounting methods. The analysis conducted using this method shows that the company’s shares are overvalued, hence the company is recommended to sell its shares. The dividend discount model, on the other hand, predicts the price of a company’s stock based on the theory that its present-day price is the sum of all its future dividend payments when discounted back tie its present value. This approach though naïve, serves as a good comparison, especially for everyday investors. Analysis using the dividend method gave an amount that is close to the price of the current traded share price.
Conclusion
In conclusion, the Altium firm is a successful company and well known for the design of efficient and powerful software and hardware that can be used for a variety of uses. The company, however, faces challenges just like any other company. The reports are prepared to analyze the current and future position of the company in the market. The swot analysis method is used to identify the company’s strengths and weaknesses in the internal environment of the organization. The company is in a good position since its strengths are more than its vulnerability. Opportunities and threats in the external environment of the firm are also identified. The company is in a better position to continue succeeding in the future since it has more opportunities than threats. The residual earnings and dividend discount methods are used to identify the company’s current market position, value, ratios, and accounting principles. Finding from the evaluation is useful to the company and also investors in making decisions. Finding from the report prove that the company is in a good position currently and has a higher chance of succeeding in the future. The findings will enable the company to use the information collected to make decisions that will improve the performance of Altium Limited.