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.
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- Income Statement
- Common-Size Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Enterprise Value to FCFF (EV/FCFF)
- Price to FCFE (P/FCFE)
- Dividend Discount Model (DDM)
- Return on Equity (ROE) since 2010
- Price to Earnings (P/E) since 2010
- Analysis of Debt
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Short-term Activity Ratios (Summary)
Charter Communications Inc., 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).
The analysis of the financial ratios over the five-year period reveals notable trends in receivables and payables management.
- Receivables Turnover
- The receivables turnover ratio demonstrates a consistent decline from 21.85 in 2020 to 17.79 in 2024. This indicates a gradual decrease in the frequency with which the company collects its accounts receivable, suggesting a lengthening in the time customers take to pay or changes in credit policy.
- Average Receivable Collection Period
- Complementing the decline in receivables turnover, the average receivable collection period increases from 17 days in 2020 to 21 days in 2024. This upward trend confirms that the company is taking more time to collect payment from its customers over the years, which could have implications for cash flow management.
- Payables Turnover
- The payables turnover ratio exhibits some fluctuation, starting at 39.23 in 2020, peaking at 43.48 in 2021, then declining to 34.53 in 2022 before gradually rising again to 37.69 in 2024. This pattern suggests changes in the company's payment behavior to suppliers, initially paying more quickly, then extending payment periods, and lastly accelerating payments once more, albeit not to the previous peak level.
- Average Payables Payment Period
- The average payables payment period reflects the inverse pattern relative to payables turnover, beginning at 9 days in 2020, dropping slightly to 8 days in 2021, increasing to 11 days in 2022, and stabilizing at 10 days in both 2023 and 2024. This indicates the company extended its payment terms around 2022 but has since maintained a moderately longer payment period compared to the beginning of the period.
- Working Capital Turnover
- No data was provided for the working capital turnover ratio, which limits the analysis of how effectively the company is utilizing its working capital relative to its sales.
Overall, the company's receivables management appears to be slowing down, with customers taking more time to pay, while payables management shows variability with a trend towards slightly extended payment periods. These changes may impact the company's liquidity and cash conversion cycle dynamics.
Turnover Ratios
Average No. Days
Receivables Turnover
Charter Communications Inc., 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) | ||||||
| Revenues | ||||||
| Accounts receivable, less allowance for doubtful accounts | ||||||
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | ||||||
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Walt Disney Co. | ||||||
| Receivables Turnover, Sector | ||||||
| Media & Entertainment | ||||||
| Receivables Turnover, Industry | ||||||
| Communication Services | ||||||
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 = Revenues ÷ Accounts receivable, less allowance for doubtful accounts
= ÷ =
2 Click competitor name to see calculations.
The analyzed financial data reveal notable trends in the revenues, accounts receivable, and receivables turnover ratio over a five-year period.
- Revenues
- Revenues demonstrate a consistent upward trajectory from 48,097 million US dollars in 2020 to 55,085 million US dollars in 2024. The increase appears steady though the annual growth rate tends to moderate slightly over the years, indicating sustained but potentially slowing revenue expansion.
- Accounts Receivable, Less Allowance for Doubtful Accounts
- Accounts receivable have increased continuously from 2,201 million US dollars in 2020 to 3,097 million US dollars in 2024. This trend suggests growing credit sales or potentially longer collection periods, reflecting an accumulation in outstanding amounts owed by customers.
- Receivables Turnover
- The receivables turnover ratio exhibits a declining trend, decreasing from 21.85 times in 2020 to 17.79 times in 2024. This decline suggests that, although sales are growing, the efficiency in collecting receivables has diminished over time. The reduction in turnover ratio could indicate that the company is taking longer on average to collect its credit sales.
Overall, the company's revenues are increasing steadily, but the growth in accounts receivable along with the declining receivables turnover ratio raises potential concerns regarding the management of credit and collections processes. Increased accounts receivable coupled with reduced turnover efficiency may impact the company’s liquidity and cash flow if these trends continue.
Payables Turnover
Charter Communications Inc., 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) | ||||||
| Operating costs and expenses | ||||||
| Accounts payable, trade | ||||||
| Short-term Activity Ratio | ||||||
| Payables turnover1 | ||||||
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Walt Disney Co. | ||||||
| Payables Turnover, Sector | ||||||
| Media & Entertainment | ||||||
| Payables Turnover, Industry | ||||||
| Communication Services | ||||||
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 = Operating costs and expenses ÷ Accounts payable, trade
= ÷ =
2 Click competitor name to see calculations.
- Operating Costs and Expenses
- The operating costs and expenses showed an overall upward trend from 2020 through 2023, increasing from $29,930 million in 2020 to $33,405 million in 2023. In 2024, there was a slight decrease to $33,167 million, indicating a marginal improvement or stabilization in managing operating expenses after consistent growth in previous years.
- Accounts Payable, Trade
- Accounts payable demonstrated some volatility over the period. Starting at $763 million in 2020, it declined to $724 million in 2021, then sharply increased to $952 million in 2022. Subsequently, it decreased to $931 million in 2023 and further to $880 million in 2024. This pattern suggests fluctuations in the company's short-term liabilities, possibly reflecting variations in purchasing or payment policies.
- Payables Turnover Ratio
- The payables turnover ratio showed notable changes, initially rising from 39.23 in 2020 to 43.48 in 2021, indicating quicker payments to suppliers or improved efficiency in accounts payable management during this period. However, the ratio declined significantly to 34.53 in 2022, followed by a slight improvement to 35.88 in 2023 and further to 37.69 in 2024. These shifts suggest a slowdown in payment cycles or changes in working capital management after 2021, though some recovery in turnover speed appears toward the end of the period.
Working Capital Turnover
Charter Communications Inc., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | ||||||
| Less: Current liabilities | ||||||
| Working capital | ||||||
| Revenues | ||||||
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | ||||||
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Walt Disney Co. | ||||||
| Working Capital Turnover, Sector | ||||||
| Media & Entertainment | ||||||
| Working Capital Turnover, Industry | ||||||
| Communication Services | ||||||
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 = Revenues ÷ Working capital
= ÷ =
2 Click competitor name to see calculations.
The financial data reveals several notable trends in the company's operational and liquidity metrics over the five-year period ending December 31, 2024.
- Working Capital
- The working capital figures consistently show negative values throughout the entire period, indicating that current liabilities exceed current assets year after year. The negative working capital increased from -5,969 million USD in 2020 to -9,253 million USD in 2024. Despite a slight improvement in 2022 compared to 2021, the overall trend shows a deepening negative working capital position, with the largest negative value recorded in 2024.
- Revenues
- Revenues demonstrate a steady upward trajectory across the period. Beginning at approximately 48,097 million USD in 2020, revenues rose consistently each year to reach 55,085 million USD in 2024. The growth in revenue, although positive, appears to be relatively moderate, with incremental increases each year rather than sharp gains.
- Working Capital Turnover
- There is no data provided for the working capital turnover ratio for any of the years. Consequently, analysis regarding the efficiency of working capital utilization relative to revenues is not possible based on the available information.
Overall, the data indicates that while the company has experienced consistent revenue growth, its liquidity position, as measured by working capital, has deteriorated, maintaining a significantly negative balance. This may suggest increasing reliance on short-term liabilities or operational inefficiencies related to current asset management. Further analysis would be needed to assess the implications for cash flow and financial health, considering the absence of working capital turnover ratios.
Average Receivable Collection Period
Charter Communications Inc., 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 | ||||||
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | ||||||
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Walt Disney Co. | ||||||
| Average Receivable Collection Period, Sector | ||||||
| Media & Entertainment | ||||||
| Average Receivable Collection Period, Industry | ||||||
| Communication Services | ||||||
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 ÷ =
2 Click competitor name to see calculations.
The data reveals a gradual decline in the receivables turnover ratio over the five-year period from 2020 to 2024. Starting at 21.85 in 2020, the ratio steadily decreases each year, reaching 17.79 by the end of 2024. This downward trend indicates that the company is collecting its receivables less frequently over time.
Correspondingly, the average receivable collection period shows an increasing pattern. It rises from 17 days in 2020 to 21 days in 2024. This increase aligns with the decreasing turnover ratio, reflecting that the company is taking longer to collect payments from its customers.
Overall, these trends suggest a elongation of the cash conversion cycle with respect to receivables. The company may be experiencing slower collection processes, which could impact liquidity if the trend continues. Monitoring this metric closely would be advisable to identify potential underlying issues affecting receivable management.
Average Payables Payment Period
Charter Communications Inc., 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 | ||||||
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | ||||||
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Netflix Inc. | ||||||
| Walt Disney Co. | ||||||
| Average Payables Payment Period, Sector | ||||||
| Media & Entertainment | ||||||
| Average Payables Payment Period, Industry | ||||||
| Communication Services | ||||||
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 ÷ =
2 Click competitor name to see calculations.
- Payables Turnover
- The payables turnover ratio demonstrates a fluctuating trend over the period from 2020 to 2024. It increased from 39.23 in 2020 to 43.48 in 2021, indicating a higher efficiency in paying off suppliers during that year. However, it experienced a significant decline to 34.53 in 2022, followed by a slight recovery to 35.88 in 2023 and further improvement to 37.69 in 2024. Despite this partial rebound, the turnover ratio in 2024 remains below the peak observed in 2021, suggesting a moderate decrease in payment efficiency compared to the earlier high point.
- Average Payables Payment Period
- This metric, expressed in days, inversely relates to the payables turnover ratio. The average payment period decreased from 9 days in 2020 to 8 days in 2021, aligning with the increase in payables turnover that year. Subsequently, the payment period lengthened to 11 days in 2022, coinciding with the drop in turnover ratio. It then reduced slightly to 10 days in both 2023 and 2024. This pattern suggests that the company extended its payment terms in 2022 but has moderately shortened them again in the subsequent years, though not to the levels seen at the beginning of the period.
- Overall Insight
- The data points to a relationship between the payables turnover ratio and the average payment period, as expected. The company initially improved its payables management efficiency, paying suppliers more rapidly through 2021, before experiencing a deterioration in 2022. Thereafter, it appears to have taken measures to improve payment speed again, albeit partially. This may reflect changes in supplier negotiation strategies, cash flow management, or operational adjustments impacting accounts payable policies.