Stock Analysis on Net
Stock Analysis on Net
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Alphabet Inc. (NASDAQ:GOOG)

Adjusted Financial Ratios

Advanced level


Adjusted Financial Ratios (Summary)

Alphabet Inc., adjusted financial ratios

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Activity Ratio
Total Asset Turnover
Reported 0.59 0.59 0.56 0.54 0.51
Adjusted 0.59 0.57 0.54 0.52 0.49
Liquidity Ratio
Current Ratio
Reported 3.37 3.92 5.14 6.29 4.67
Adjusted 3.54 4.15 5.49 6.76 4.88
Solvency Ratios
Debt to Equity
Reported 0.02 0.02 0.03 0.03 0.04
Adjusted 0.08 0.07 0.08 0.08 0.10
Debt to Capital
Reported 0.02 0.02 0.03 0.03 0.04
Adjusted 0.07 0.07 0.07 0.07 0.09
Financial Leverage
Reported 1.37 1.31 1.29 1.20 1.23
Adjusted 1.34 1.33 1.33 1.24 1.27
Profitability Ratios
Net Profit Margin
Reported 21.22% 22.46% 11.42% 21.58% 21.80%
Adjusted 22.05% 22.41% 13.41% 21.36% 19.11%
Return on Equity (ROE)
Reported 17.05% 17.30% 8.30% 14.01% 13.59%
Adjusted 17.38% 16.99% 9.65% 13.77% 11.80%
Return on Assets (ROA)
Reported 12.45% 13.20% 6.42% 11.63% 11.09%
Adjusted 12.94% 12.73% 7.28% 11.10% 9.30%

Based on: 10-K (filing date: 2020-02-04), 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Alphabet Inc.’s adjusted total asset turnover ratio improved from 2017 to 2018 and from 2018 to 2019.
Adjusted current ratio A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities. Alphabet Inc.’s adjusted current ratio deteriorated from 2017 to 2018 and from 2018 to 2019.
Adjusted debt-to-equity ratio A solvency ratio calculated as adjusted total debt divided by adjusted total equity. Alphabet Inc.’s adjusted debt-to-equity ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.
Adjusted debt-to-capital ratio A solvency ratio calculated as adjusted total debt divided by adjusted total debt plus adjusted total equity. Alphabet Inc.’s adjusted debt-to-capital ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Alphabet Inc.’s adjusted financial leverage ratio increased from 2017 to 2018 and from 2018 to 2019.
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Alphabet Inc.’s adjusted net profit margin ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted total equity. Alphabet Inc.’s adjusted ROE improved from 2017 to 2018 and from 2018 to 2019.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Alphabet Inc.’s adjusted ROA improved from 2017 to 2018 and from 2018 to 2019.

Alphabet Inc., Financial Ratios: Reported vs. Adjusted


Adjusted Total Asset Turnover

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Reported
Selected Financial Data (US$ in millions)
Revenues 161,857  136,819  110,855  90,272  74,989 
Total assets 275,909  232,792  197,295  167,497  147,461 
Activity Ratio
Total asset turnover1 0.59 0.59 0.56 0.54 0.51
Adjusted
Selected Financial Data (US$ in millions)
Adjusted revenues2 161,943  137,227  111,326  90,634  75,072 
Adjusted total assets3 275,941  241,656  204,982  174,465  154,216 
Activity Ratio
Adjusted total asset turnover4 0.59 0.57 0.54 0.52 0.49

Based on: 10-K (filing date: 2020-02-04), 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11).

1 2019 Calculation
Total asset turnover = Revenues ÷ Total assets
= 161,857 ÷ 275,909 = 0.59

2 Adjusted revenues. See details »

3 Adjusted total assets. See details »

4 2019 Calculation
Adjusted total asset turnover = Adjusted revenues ÷ Adjusted total assets
= 161,943 ÷ 275,941 = 0.59

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Alphabet Inc.’s adjusted total asset turnover ratio improved from 2017 to 2018 and from 2018 to 2019.

Adjusted Current Ratio

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Reported
Selected Financial Data (US$ in millions)
Current assets 152,578  135,676  124,308  105,408  90,114 
Current liabilities 45,221  34,620  24,183  16,756  19,310 
Liquidity Ratio
Current ratio1 3.37 3.92 5.14 6.29 4.67
Adjusted
Selected Financial Data (US$ in millions)
Adjusted current assets2 153,331  136,405  124,982  105,875  90,410 
Adjusted current liabilities3 43,313  32,836  22,751  15,657  18,522 
Liquidity Ratio
Adjusted current ratio4 3.54 4.15 5.49 6.76 4.88

Based on: 10-K (filing date: 2020-02-04), 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11).

1 2019 Calculation
Current ratio = Current assets ÷ Current liabilities
= 152,578 ÷ 45,221 = 3.37

2 Adjusted current assets. See details »

3 Adjusted current liabilities. See details »

4 2019 Calculation
Adjusted current ratio = Adjusted current assets ÷ Adjusted current liabilities
= 153,331 ÷ 43,313 = 3.54

Liquidity ratio Description The company
Adjusted current ratio A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities. Alphabet Inc.’s adjusted current ratio deteriorated from 2017 to 2018 and from 2018 to 2019.

Adjusted Debt to Equity

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Reported
Selected Financial Data (US$ in millions)
Total debt 4,554  4,012  3,969  3,935  5,220 
Stockholders’ equity 201,442  177,628  152,502  139,036  120,331 
Solvency Ratio
Debt to equity1 0.02 0.02 0.03 0.03 0.04
Adjusted
Selected Financial Data (US$ in millions)
Adjusted total debt2 15,967  12,884  11,662  10,819  11,930 
Adjusted stockholders’ equity3 205,441  181,064  154,698  140,647  121,504 
Solvency Ratio
Adjusted debt to equity4 0.08 0.07 0.08 0.08 0.10

Based on: 10-K (filing date: 2020-02-04), 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11).

1 2019 Calculation
Debt to equity = Total debt ÷ Stockholders’ equity
= 4,554 ÷ 201,442 = 0.02

2 Adjusted total debt. See details »

3 Adjusted stockholders’ equity. See details »

4 2019 Calculation
Adjusted debt to equity = Adjusted total debt ÷ Adjusted stockholders’ equity
= 15,967 ÷ 205,441 = 0.08

Solvency ratio Description The company
Adjusted debt-to-equity ratio A solvency ratio calculated as adjusted total debt divided by adjusted total equity. Alphabet Inc.’s adjusted debt-to-equity ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.

Adjusted Debt to Capital

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Reported
Selected Financial Data (US$ in millions)
Total debt 4,554  4,012  3,969  3,935  5,220 
Total capital 205,996  181,640  156,471  142,971  125,551 
Solvency Ratio
Debt to capital1 0.02 0.02 0.03 0.03 0.04
Adjusted
Selected Financial Data (US$ in millions)
Adjusted total debt2 15,967  12,884  11,662  10,819  11,930 
Adjusted total capital3 221,408  193,948  166,360  151,466  133,434 
Solvency Ratio
Adjusted debt to capital4 0.07 0.07 0.07 0.07 0.09

Based on: 10-K (filing date: 2020-02-04), 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11).

1 2019 Calculation
Debt to capital = Total debt ÷ Total capital
= 4,554 ÷ 205,996 = 0.02

2 Adjusted total debt. See details »

3 Adjusted total capital. See details »

4 2019 Calculation
Adjusted debt to capital = Adjusted total debt ÷ Adjusted total capital
= 15,967 ÷ 221,408 = 0.07

Solvency ratio Description The company
Adjusted debt-to-capital ratio A solvency ratio calculated as adjusted total debt divided by adjusted total debt plus adjusted total equity. Alphabet Inc.’s adjusted debt-to-capital ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.

Adjusted Financial Leverage

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Reported
Selected Financial Data (US$ in millions)
Total assets 275,909  232,792  197,295  167,497  147,461 
Stockholders’ equity 201,442  177,628  152,502  139,036  120,331 
Solvency Ratio
Financial leverage1 1.37 1.31 1.29 1.20 1.23
Adjusted
Selected Financial Data (US$ in millions)
Adjusted total assets2 275,941  241,656  204,982  174,465  154,216 
Adjusted stockholders’ equity3 205,441  181,064  154,698  140,647  121,504 
Solvency Ratio
Adjusted financial leverage4 1.34 1.33 1.33 1.24 1.27

Based on: 10-K (filing date: 2020-02-04), 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11).

1 2019 Calculation
Financial leverage = Total assets ÷ Stockholders’ equity
= 275,909 ÷ 201,442 = 1.37

2 Adjusted total assets. See details »

3 Adjusted stockholders’ equity. See details »

4 2019 Calculation
Adjusted financial leverage = Adjusted total assets ÷ Adjusted stockholders’ equity
= 275,941 ÷ 205,441 = 1.34

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Alphabet Inc.’s adjusted financial leverage ratio increased from 2017 to 2018 and from 2018 to 2019.

Adjusted Net Profit Margin

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Reported
Selected Financial Data (US$ in millions)
Net income 34,343  30,736  12,662  19,478  16,348 
Revenues 161,857  136,819  110,855  90,272  74,989 
Profitability Ratio
Net profit margin1 21.22% 22.46% 11.42% 21.58% 21.80%
Adjusted
Selected Financial Data (US$ in millions)
Adjusted net income2 35,702  30,756  14,927  19,363  14,343 
Adjusted revenues3 161,943  137,227  111,326  90,634  75,072 
Profitability Ratio
Adjusted net profit margin4 22.05% 22.41% 13.41% 21.36% 19.11%

Based on: 10-K (filing date: 2020-02-04), 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11).

1 2019 Calculation
Net profit margin = 100 × Net income ÷ Revenues
= 100 × 34,343 ÷ 161,857 = 21.22%

2 Adjusted net income. See details »

3 Adjusted revenues. See details »

4 2019 Calculation
Adjusted net profit margin = 100 × Adjusted net income ÷ Adjusted revenues
= 100 × 35,702 ÷ 161,943 = 22.05%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Alphabet Inc.’s adjusted net profit margin ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019.

Adjusted Return on Equity (ROE)

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Reported
Selected Financial Data (US$ in millions)
Net income 34,343  30,736  12,662  19,478  16,348 
Stockholders’ equity 201,442  177,628  152,502  139,036  120,331 
Profitability Ratio
ROE1 17.05% 17.30% 8.30% 14.01% 13.59%
Adjusted
Selected Financial Data (US$ in millions)
Adjusted net income2 35,702  30,756  14,927  19,363  14,343 
Adjusted stockholders’ equity3 205,441  181,064  154,698  140,647  121,504 
Profitability Ratio
Adjusted ROE4 17.38% 16.99% 9.65% 13.77% 11.80%

Based on: 10-K (filing date: 2020-02-04), 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11).

1 2019 Calculation
ROE = 100 × Net income ÷ Stockholders’ equity
= 100 × 34,343 ÷ 201,442 = 17.05%

2 Adjusted net income. See details »

3 Adjusted stockholders’ equity. See details »

4 2019 Calculation
Adjusted ROE = 100 × Adjusted net income ÷ Adjusted stockholders’ equity
= 100 × 35,702 ÷ 205,441 = 17.38%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted total equity. Alphabet Inc.’s adjusted ROE improved from 2017 to 2018 and from 2018 to 2019.

Adjusted Return on Assets (ROA)

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Reported
Selected Financial Data (US$ in millions)
Net income 34,343  30,736  12,662  19,478  16,348 
Total assets 275,909  232,792  197,295  167,497  147,461 
Profitability Ratio
ROA1 12.45% 13.20% 6.42% 11.63% 11.09%
Adjusted
Selected Financial Data (US$ in millions)
Adjusted net income2 35,702  30,756  14,927  19,363  14,343 
Adjusted total assets3 275,941  241,656  204,982  174,465  154,216 
Profitability Ratio
Adjusted ROA4 12.94% 12.73% 7.28% 11.10% 9.30%

Based on: 10-K (filing date: 2020-02-04), 10-K (filing date: 2019-02-05), 10-K (filing date: 2018-02-06), 10-K (filing date: 2017-02-03), 10-K (filing date: 2016-02-11).

1 2019 Calculation
ROA = 100 × Net income ÷ Total assets
= 100 × 34,343 ÷ 275,909 = 12.45%

2 Adjusted net income. See details »

3 Adjusted total assets. See details »

4 2019 Calculation
Adjusted ROA = 100 × Adjusted net income ÷ Adjusted total assets
= 100 × 35,702 ÷ 275,941 = 12.94%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Alphabet Inc.’s adjusted ROA improved from 2017 to 2018 and from 2018 to 2019.