Analysis of Long-term (Investment) Activity Ratios
Quarterly Data
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
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- Balance Sheet: Assets
- Analysis of Liquidity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Analysis of Reportable Segments
- Enterprise Value to EBITDA (EV/EBITDA)
- Present Value of Free Cash Flow to Equity (FCFE)
- Selected Financial Data since 2005
- Operating Profit Margin since 2005
- Return on Assets (ROA) since 2005
- Analysis of Debt
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Long-term Activity Ratios (Summary)
Raytheon Co., long-term (investment) activity ratios (quarterly data)
Based on: 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-29), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-07-01), 10-Q (reporting date: 2018-04-01), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-10-01), 10-Q (reporting date: 2017-07-02), 10-Q (reporting date: 2017-04-02), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-10-02), 10-Q (reporting date: 2016-07-03), 10-Q (reporting date: 2016-04-03).
- Net Fixed Asset Turnover
- The ratio shows a declining trend over the reported periods, starting at 11.76 in early 2016 and steadily decreasing to 8.7 by the end of 2019. This suggests a gradual reduction in the efficiency with which net fixed assets are generating revenue.
- Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)
- This adjusted ratio follows a similar downward trajectory as the standard net fixed asset turnover but experiences a more pronounced decline starting in early 2019. It drops from 9.53 in late 2018 to 6.9 by the end of 2019, indicating that incorporating lease assets reveals a steeper decrease in asset efficiency.
- Total Asset Turnover
- The total asset turnover ratio demonstrates relative stability with slight fluctuations throughout the periods. Beginning at 0.82 in early 2016, it marginally increases to mid-0.8x levels, peaking around 0.88 in late 2018 before settling back near 0.84 by the end of 2019. This stability suggests consistent overall efficiency in utilizing total assets to generate sales.
- Equity Turnover
- Equity turnover exhibits modest variability, initially declining from 2.34 in early 2016 to a low near 2.21 in late 2019. Although the ratio fluctuates, it generally maintains a level around 2.3 to 2.5. The highest point occurs around the end of 2017 at 2.54, followed by a slight decrease. These movements indicate relatively stable but somewhat diminishing efficiency in using shareholder equity to produce revenue over time.
Net Fixed Asset Turnover
Raytheon Co., net fixed asset turnover calculation (quarterly data)
| Dec 31, 2019 | Sep 29, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jul 1, 2018 | Apr 1, 2018 | Dec 31, 2017 | Oct 1, 2017 | Jul 2, 2017 | Apr 2, 2017 | Dec 31, 2016 | Oct 2, 2016 | Jul 3, 2016 | Apr 3, 2016 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||
| Net sales | |||||||||||||||||||||
| Property, plant and equipment, net | |||||||||||||||||||||
| Long-term Activity Ratio | |||||||||||||||||||||
| Net fixed asset turnover1 | |||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||
| Net Fixed Asset Turnover, Competitors2 | |||||||||||||||||||||
| Boeing Co. | |||||||||||||||||||||
| Caterpillar Inc. | |||||||||||||||||||||
| Eaton Corp. plc | |||||||||||||||||||||
| GE Aerospace | |||||||||||||||||||||
| Honeywell International Inc. | |||||||||||||||||||||
| Lockheed Martin Corp. | |||||||||||||||||||||
| RTX Corp. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-29), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-07-01), 10-Q (reporting date: 2018-04-01), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-10-01), 10-Q (reporting date: 2017-07-02), 10-Q (reporting date: 2017-04-02), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-10-02), 10-Q (reporting date: 2016-07-03), 10-Q (reporting date: 2016-04-03).
1 Q4 2019 Calculation
Net fixed asset turnover
= (Net salesQ4 2019
+ Net salesQ3 2019
+ Net salesQ2 2019
+ Net salesQ1 2019)
÷ Property, plant and equipment, net
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The financial data indicates a steady increase in net sales over the examined quarterly periods. Starting at approximately $5.8 billion in early 2016, net sales exhibit a general upward trend, reaching close to $7.8 billion by the end of 2019. Despite minor fluctuations quarter-to-quarter, the overall growth in sales volume is clear and consistent, reflecting potentially expanded operations or improved market presence during the timeframe.
In parallel, net property, plant, and equipment (PP&E) values show progressive growth throughout the periods. From about $2.0 billion at the beginning of 2016, the net value of fixed assets increases steadily to roughly $3.4 billion by the end of 2019. This suggests continued capital investment in physical assets, possibly indicative of ongoing expansion, modernization, or enhancement of productive capacity.
Conversely, the net fixed asset turnover ratio demonstrates a declining trend across the reviewed periods. The ratio decreases from approximately 11.76 in early 2016 to around 8.7 by the end of 2019. This diminishing ratio indicates that the efficiency with which the company is using its fixed assets to generate sales is gradually weakening. Despite higher absolute sales figures, the growth rate of fixed assets surpasses sales growth, reducing overall asset utilization efficiency.
Overall, the data points to a company experiencing growth in sales and invested fixed assets, yet facing a decreasing fixed asset turnover. The declining turnover ratio warrants monitoring to ensure that asset investment continues to translate effectively into revenue generation and operational efficiency.
Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
Raytheon Co., net fixed asset turnover (including operating lease, right-of-use asset) calculation (quarterly data)
| Dec 31, 2019 | Sep 29, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jul 1, 2018 | Apr 1, 2018 | Dec 31, 2017 | Oct 1, 2017 | Jul 2, 2017 | Apr 2, 2017 | Dec 31, 2016 | Oct 2, 2016 | Jul 3, 2016 | Apr 3, 2016 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||
| Net sales | |||||||||||||||||||||
| Property, plant and equipment, net | |||||||||||||||||||||
| Operating lease right-of-use assets | |||||||||||||||||||||
| Property, plant and equipment, net (including operating lease, right-of-use asset) | |||||||||||||||||||||
| Long-term Activity Ratio | |||||||||||||||||||||
| Net fixed asset turnover (including operating lease, right-of-use asset)1 | |||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Competitors2 | |||||||||||||||||||||
| Eaton Corp. plc | |||||||||||||||||||||
| RTX Corp. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-29), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-07-01), 10-Q (reporting date: 2018-04-01), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-10-01), 10-Q (reporting date: 2017-07-02), 10-Q (reporting date: 2017-04-02), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-10-02), 10-Q (reporting date: 2016-07-03), 10-Q (reporting date: 2016-04-03).
1 Q4 2019 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset)
= (Net salesQ4 2019
+ Net salesQ3 2019
+ Net salesQ2 2019
+ Net salesQ1 2019)
÷ Property, plant and equipment, net (including operating lease, right-of-use asset)
= ( + + + )
÷ =
2 Click competitor name to see calculations.
- Net Sales Trend
- Net sales demonstrated a generally increasing trajectory over the observed periods. Starting at 5,763 million USD in the first quarter of 2016, sales showed moderate quarterly growth with some fluctuations, reaching 7,842 million USD by the last quarter of 2019. Notably, there is a marked acceleration in sales growth from 2017 onwards, with several quarters exceeding 6,500 million USD, culminating in the highest recorded sales of 7,842 million USD at the end of 2019.
- Property, Plant and Equipment (PP&E), Net
- The net value of property, plant, and equipment, including operating lease right-of-use assets, exhibited a steady increase throughout the period analyzed. Beginning at 2,018 million USD in early 2016, this asset base expanded consistently, reaching 4,228 million USD by the final quarter of 2019. The growth pace appeared relatively smooth with no significant drops, reflecting ongoing investments or acquisitions in fixed assets over time. This upward trend signals capital expenditure efforts to support operational capacity or modernization.
- Net Fixed Asset Turnover Ratio
- The net fixed asset turnover ratio, which measures the efficiency of using fixed assets to generate sales, showed a notable declining trend. Initially, the ratio was around 11.76 at the start of 2016, sustaining mild fluctuations before gradually declining to 6.9 by the end of 2019. This decline suggests that while net sales were increasing, the asset base expanded at a faster rate, thus reducing efficiency in terms of sales generated per unit of fixed asset. This trend could indicate potential overcapacity or a strategic shift involving heavy investment ahead of sales realization.
- Overall Interpretation
- The financial data illustrates a company experiencing growth in sales accompanied by continuous investments in fixed assets. However, this growth in assets outpaces sales increases, leading to reduced asset turnover efficiency over the examined quarters. The decline in asset turnover may warrant further examination to understand whether it is a temporary effect of recent capital expenditures or a sign of diminishing returns on fixed asset investments. Management may need to focus on leveraging asset productivity or reassessing capital allocation strategies to improve operational efficiency in the future.
Total Asset Turnover
Raytheon Co., total asset turnover calculation (quarterly data)
| Dec 31, 2019 | Sep 29, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jul 1, 2018 | Apr 1, 2018 | Dec 31, 2017 | Oct 1, 2017 | Jul 2, 2017 | Apr 2, 2017 | Dec 31, 2016 | Oct 2, 2016 | Jul 3, 2016 | Apr 3, 2016 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||
| Net sales | |||||||||||||||||||||
| Total assets | |||||||||||||||||||||
| Long-term Activity Ratio | |||||||||||||||||||||
| Total asset turnover1 | |||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||
| Total Asset Turnover, Competitors2 | |||||||||||||||||||||
| Boeing Co. | |||||||||||||||||||||
| Caterpillar Inc. | |||||||||||||||||||||
| Eaton Corp. plc | |||||||||||||||||||||
| GE Aerospace | |||||||||||||||||||||
| Honeywell International Inc. | |||||||||||||||||||||
| Lockheed Martin Corp. | |||||||||||||||||||||
| RTX Corp. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-29), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-07-01), 10-Q (reporting date: 2018-04-01), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-10-01), 10-Q (reporting date: 2017-07-02), 10-Q (reporting date: 2017-04-02), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-10-02), 10-Q (reporting date: 2016-07-03), 10-Q (reporting date: 2016-04-03).
1 Q4 2019 Calculation
Total asset turnover
= (Net salesQ4 2019
+ Net salesQ3 2019
+ Net salesQ2 2019
+ Net salesQ1 2019)
÷ Total assets
= ( + + + )
÷ =
2 Click competitor name to see calculations.
- Net Sales
- The net sales exhibit a generally increasing trend over the analyzed quarters. Starting at 5,763 million USD in the first quarter, sales showed steady growth with some periodic fluctuations, reaching 7,842 million USD by the last quarter. Notable increments occurred in the fourth quarter of 2017 and the fourth quarter of 2018, reflecting cyclical peaks that suggest possible seasonal or year-end demand effects. The continuous upward trajectory indicates an overall expansion in revenue generation.
- Total Assets
- Total assets display a gradual increase from 28,829 million USD at the beginning to 34,566 million USD by the end of the period. The growth in assets is steady without abrupt changes, pointing toward consistent investment or accumulation of resources. Slight dips are evident in mid-2018, yet the general direction remains upward, suggesting asset base strengthening over time possibly to support growing operations.
- Total Asset Turnover
- The total asset turnover ratio fluctuates within a moderate range between 0.80 and 0.88. Beginning near 0.82, the ratio experiences minor oscillations but generally maintains levels above 0.80, indicating stable efficiency in utilizing assets to generate sales. Peaks near 0.88 in late 2018 and mid to late 2019 imply improved asset utilization during these periods, while slight decreases toward 0.84 in the final quarter may indicate marginally lower efficiency at that time. Overall, the ratio reflects consistent operational effectiveness relative to the asset base.
- Insights
- The combination of increasing net sales and total assets, alongside a relatively stable asset turnover ratio, suggests balanced growth where asset increases are approximately matched by sales growth, maintaining operational efficiency. The presence of periodic upticks in sales and asset turnover ratios may be influenced by industry cycles or internal strategic initiatives. The data reflects an ongoing expansion phase supported by adequate asset deployment without significant deterioration in asset productivity.
Equity Turnover
Raytheon Co., equity turnover calculation (quarterly data)
| Dec 31, 2019 | Sep 29, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jul 1, 2018 | Apr 1, 2018 | Dec 31, 2017 | Oct 1, 2017 | Jul 2, 2017 | Apr 2, 2017 | Dec 31, 2016 | Oct 2, 2016 | Jul 3, 2016 | Apr 3, 2016 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||
| Net sales | |||||||||||||||||||||
| Total Raytheon Company stockholders’ equity | |||||||||||||||||||||
| Long-term Activity Ratio | |||||||||||||||||||||
| Equity turnover1 | |||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||
| Equity Turnover, Competitors2 | |||||||||||||||||||||
| Boeing Co. | |||||||||||||||||||||
| Caterpillar Inc. | |||||||||||||||||||||
| Eaton Corp. plc | |||||||||||||||||||||
| GE Aerospace | |||||||||||||||||||||
| Honeywell International Inc. | |||||||||||||||||||||
| Lockheed Martin Corp. | |||||||||||||||||||||
| RTX Corp. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-29), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-07-01), 10-Q (reporting date: 2018-04-01), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-10-01), 10-Q (reporting date: 2017-07-02), 10-Q (reporting date: 2017-04-02), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-10-02), 10-Q (reporting date: 2016-07-03), 10-Q (reporting date: 2016-04-03).
1 Q4 2019 Calculation
Equity turnover
= (Net salesQ4 2019
+ Net salesQ3 2019
+ Net salesQ2 2019
+ Net salesQ1 2019)
÷ Total Raytheon Company stockholders’ equity
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial metrics demonstrates several notable trends across the observed periods.
- Net Sales
- Net sales exhibit a generally upward trend over the quarters from April 2016 through December 2019. Beginning at approximately $5.8 billion in early 2016, sales increased with some fluctuations, reaching a peak near $7.8 billion by the end of 2019. There are periodic minor declines or plateaus in some quarters, such as between April and October 2017, and slight dips in early 2019; however, the overall trajectory is growth-oriented.
- Total Stockholders’ Equity
- The total stockholders’ equity fluctuates within the range of approximately $10.1 billion to $13.0 billion over the time frame. There is a modest increase through 2016 into early 2017, followed by some variability. Equity peaked around the third quarter of 2019 before decreasing slightly by the final quarter of 2019. Overall, equity shows a positive trend but with some irregularities that suggest capital changes or adjustments during the period.
- Equity Turnover Ratio
- The equity turnover ratio remains relatively stable between approximately 2.2 and 2.5, indicating consistent efficiency in generating sales from shareholders' equity. While there is slight variability quarter to quarter, no major trends of increase or decrease are evident. The ratio demonstrates a generally steady relationship between revenue generation and equity invested over the observed quarters.
In summary, the company shows a solid growth pattern in net sales with corresponding moderate growth and some variability in equity levels. The stability of the equity turnover ratio suggests maintained effectiveness in utilizing equity to produce sales despite these fluctuations. These patterns collectively indicate consistent operational performance with growth in top-line revenue accompanied by relatively stable equity utilization efficiency.