Analysis of Short-term (Operating) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
Short-term Activity Ratios (Summary)
McDonald’s Corp., short-term (operating) activity ratios
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | McDonald’s Corp. inventory turnover ratio improved from 2022 to 2023 but then slightly deteriorated from 2023 to 2024 not reaching 2022 level. |
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | McDonald’s Corp. receivables turnover ratio deteriorated from 2022 to 2023 but then improved from 2023 to 2024 not reaching 2022 level. |
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | McDonald’s Corp. payables turnover ratio decreased from 2022 to 2023 but then increased from 2023 to 2024 exceeding 2022 level. |
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. | McDonald’s Corp. working capital turnover ratio improved from 2022 to 2023 and from 2023 to 2024. |
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average inventory processing period | An activity ratio equal to the number of days in the period divided by inventory turnover over the period. | |
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | McDonald’s Corp. number of days of receivables outstanding deteriorated from 2022 to 2023 but then improved from 2023 to 2024 not reaching 2022 level. |
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | |
| Average payables payment period | An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period. | McDonald’s Corp. number of days of payables outstanding increased from 2022 to 2023 but then decreased significantly from 2023 to 2024. |
| Cash conversion cycle | A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period. |
Inventory Turnover
McDonald’s Corp., inventory turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Company-operated restaurant expenses | 8,335) | 8,224) | 7,381) | 8,047) | 6,981) | |
| Inventories, at cost, not in excess of market | 56) | 53) | 52) | 56) | 51) | |
| Short-term Activity Ratio | ||||||
| Inventory turnover1 | 148.84 | 155.76 | 141.94 | 144.74 | 136.62 | |
| Benchmarks | ||||||
| Inventory Turnover, Competitors2 | ||||||
| Chipotle Mexican Grill Inc. | 169.51 | 185.34 | 184.27 | 177.91 | 186.94 | |
| Starbucks Corp. | 14.89 | 14.46 | 10.97 | 12.89 | 11.90 | |
| Inventory Turnover, Sector | ||||||
| Consumer Services | 36.51 | 34.08 | 24.92 | 27.58 | 23.36 | |
| Inventory Turnover, Industry | ||||||
| Consumer Discretionary | 7.78 | 6.99 | 6.67 | 7.04 | 7.48 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Inventory turnover = Company-operated restaurant expenses ÷ Inventories, at cost, not in excess of market
= 8,335 ÷ 56 = 148.84
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | McDonald’s Corp. inventory turnover ratio improved from 2022 to 2023 but then slightly deteriorated from 2023 to 2024 not reaching 2022 level. |
Receivables Turnover
McDonald’s Corp., receivables turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Sales by Company-operated restaurants | 9,782) | 9,742) | 8,748) | 9,787) | 8,139) | |
| Accounts and notes receivable | 2,383) | 2,488) | 2,115) | 1,872) | 2,110) | |
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | 4.10 | 3.92 | 4.14 | 5.23 | 3.86 | |
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Airbnb Inc. | 75.52 | 48.38 | 52.17 | 53.67 | 34.05 | |
| Booking Holdings Inc. | 7.42 | 6.57 | 7.67 | 8.07 | 12.85 | |
| Chipotle Mexican Grill Inc. | 78.59 | 85.44 | 80.79 | 75.77 | 57.27 | |
| Starbucks Corp. | 29.80 | 30.38 | 27.44 | 30.92 | 26.62 | |
| Receivables Turnover, Sector | ||||||
| Consumer Services | 13.00 | 11.99 | 12.98 | 14.46 | 12.83 | |
| Receivables Turnover, Industry | ||||||
| Consumer Discretionary | 18.67 | 17.85 | 17.96 | 21.22 | 21.85 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Receivables turnover = Sales by Company-operated restaurants ÷ Accounts and notes receivable
= 9,782 ÷ 2,383 = 4.10
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | McDonald’s Corp. receivables turnover ratio deteriorated from 2022 to 2023 but then improved from 2023 to 2024 not reaching 2022 level. |
Payables Turnover
McDonald’s Corp., payables turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Company-operated restaurant expenses | 8,335) | 8,224) | 7,381) | 8,047) | 6,981) | |
| Accounts payable | 1,029) | 1,103) | 980) | 1,007) | 741) | |
| Short-term Activity Ratio | ||||||
| Payables turnover1 | 8.10 | 7.46 | 7.53 | 7.99 | 9.42 | |
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Airbnb Inc. | 13.23 | 12.08 | 10.94 | 9.77 | 10.96 | |
| Booking Holdings Inc. | 6.21 | 6.14 | 6.82 | 6.91 | 9.25 | |
| Chipotle Mexican Grill Inc. | 39.38 | 36.86 | 35.61 | 35.79 | 40.52 | |
| Starbucks Corp. | 16.59 | 16.92 | 16.57 | 17.06 | 18.50 | |
| Payables Turnover, Sector | ||||||
| Consumer Services | 10.10 | 10.01 | 10.75 | 11.42 | 14.22 | |
| Payables Turnover, Industry | ||||||
| Consumer Discretionary | 5.36 | 5.18 | 4.80 | 4.66 | 4.74 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Payables turnover = Company-operated restaurant expenses ÷ Accounts payable
= 8,335 ÷ 1,029 = 8.10
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | McDonald’s Corp. payables turnover ratio decreased from 2022 to 2023 but then increased from 2023 to 2024 exceeding 2022 level. |
Working Capital Turnover
McDonald’s Corp., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | 4,599) | 7,986) | 5,424) | 7,149) | 6,243) | |
| Less: Current liabilities | 3,861) | 6,859) | 3,802) | 4,020) | 6,181) | |
| Working capital | 738) | 1,127) | 1,622) | 3,129) | 62) | |
| Sales by Company-operated restaurants | 9,782) | 9,742) | 8,748) | 9,787) | 8,139) | |
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | 13.25 | 8.64 | 5.39 | 3.13 | 131.28 | |
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Airbnb Inc. | 1.58 | 1.51 | 1.22 | 0.99 | 0.89 | |
| Booking Holdings Inc. | 4.90 | 5.77 | 2.33 | 1.59 | 0.77 | |
| Chipotle Mexican Grill Inc. | 18.49 | 16.73 | 34.00 | 14.86 | 10.01 | |
| Starbucks Corp. | — | — | — | 18.11 | 51.17 | |
| Working Capital Turnover, Sector | ||||||
| Consumer Services | 8.38 | 8.74 | 5.39 | 3.49 | 3.50 | |
| Working Capital Turnover, Industry | ||||||
| Consumer Discretionary | 13.56 | 14.99 | 18.57 | 11.02 | 13.68 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Working capital turnover = Sales by Company-operated restaurants ÷ Working capital
= 9,782 ÷ 738 = 13.25
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. | McDonald’s Corp. working capital turnover ratio improved from 2022 to 2023 and from 2023 to 2024. |
Average Inventory Processing Period
McDonald’s Corp., average inventory processing period calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Inventory turnover | 148.84 | 155.76 | 141.94 | 144.74 | 136.62 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average inventory processing period1 | 2 | 2 | 3 | 3 | 3 | |
| Benchmarks (no. days) | ||||||
| Average Inventory Processing Period, Competitors2 | ||||||
| Chipotle Mexican Grill Inc. | 2 | 2 | 2 | 2 | 2 | |
| Starbucks Corp. | 25 | 25 | 33 | 28 | 31 | |
| Average Inventory Processing Period, Sector | ||||||
| Consumer Services | 10 | 11 | 15 | 13 | 16 | |
| Average Inventory Processing Period, Industry | ||||||
| Consumer Discretionary | 47 | 52 | 55 | 52 | 49 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 148.84 = 2
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average inventory processing period | An activity ratio equal to the number of days in the period divided by inventory turnover over the period. |
Average Receivable Collection Period
McDonald’s Corp., average receivable collection period calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | 4.10 | 3.92 | 4.14 | 5.23 | 3.86 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | 89 | 93 | 88 | 70 | 95 | |
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Airbnb Inc. | 5 | 8 | 7 | 7 | 11 | |
| Booking Holdings Inc. | 49 | 56 | 48 | 45 | 28 | |
| Chipotle Mexican Grill Inc. | 5 | 4 | 5 | 5 | 6 | |
| Starbucks Corp. | 12 | 12 | 13 | 12 | 14 | |
| Average Receivable Collection Period, Sector | ||||||
| Consumer Services | 28 | 30 | 28 | 25 | 28 | |
| Average Receivable Collection Period, Industry | ||||||
| Consumer Discretionary | 20 | 20 | 20 | 17 | 17 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 4.10 = 89
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | McDonald’s Corp. number of days of receivables outstanding deteriorated from 2022 to 2023 but then improved from 2023 to 2024 not reaching 2022 level. |
Operating Cycle
McDonald’s Corp., operating cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 2 | 2 | 3 | 3 | 3 | |
| Average receivable collection period | 89 | 93 | 88 | 70 | 95 | |
| Short-term Activity Ratio | ||||||
| Operating cycle1 | 91 | 95 | 91 | 73 | 98 | |
| Benchmarks | ||||||
| Operating Cycle, Competitors2 | ||||||
| Chipotle Mexican Grill Inc. | 7 | 6 | 7 | 7 | 8 | |
| Starbucks Corp. | 37 | 37 | 46 | 40 | 45 | |
| Operating Cycle, Sector | ||||||
| Consumer Services | 38 | 41 | 43 | 38 | 44 | |
| Operating Cycle, Industry | ||||||
| Consumer Discretionary | 67 | 72 | 75 | 69 | 66 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 2 + 89 = 91
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. |
Average Payables Payment Period
McDonald’s Corp., average payables payment period calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | 8.10 | 7.46 | 7.53 | 7.99 | 9.42 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | 45 | 49 | 48 | 46 | 39 | |
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Airbnb Inc. | 28 | 30 | 33 | 37 | 33 | |
| Booking Holdings Inc. | 59 | 59 | 54 | 53 | 39 | |
| Chipotle Mexican Grill Inc. | 9 | 10 | 10 | 10 | 9 | |
| Starbucks Corp. | 22 | 22 | 22 | 21 | 20 | |
| Average Payables Payment Period, Sector | ||||||
| Consumer Services | 36 | 36 | 34 | 32 | 26 | |
| Average Payables Payment Period, Industry | ||||||
| Consumer Discretionary | 68 | 70 | 76 | 78 | 77 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 8.10 = 45
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Average payables payment period | An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period. | McDonald’s Corp. number of days of payables outstanding increased from 2022 to 2023 but then decreased significantly from 2023 to 2024. |
Cash Conversion Cycle
McDonald’s Corp., cash conversion cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 2 | 2 | 3 | 3 | 3 | |
| Average receivable collection period | 89 | 93 | 88 | 70 | 95 | |
| Average payables payment period | 45 | 49 | 48 | 46 | 39 | |
| Short-term Activity Ratio | ||||||
| Cash conversion cycle1 | 46 | 46 | 43 | 27 | 59 | |
| Benchmarks | ||||||
| Cash Conversion Cycle, Competitors2 | ||||||
| Chipotle Mexican Grill Inc. | -2 | -4 | -3 | -3 | -1 | |
| Starbucks Corp. | 15 | 15 | 24 | 19 | 25 | |
| Cash Conversion Cycle, Sector | ||||||
| Consumer Services | 2 | 5 | 9 | 6 | 18 | |
| Cash Conversion Cycle, Industry | ||||||
| Consumer Discretionary | -1 | 2 | -1 | -9 | -11 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 2 + 89 – 45 = 46
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Cash conversion cycle | A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period. |