Microsoft Excel LibreOffice Calc

Cisco Systems Inc. (CSCO)

Short-term (Operating) Activity Analysis

Difficulty: Beginner

Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.

Ratios (Summary)

Cisco Systems Inc., short-term (operating) activity ratios

Microsoft Excel LibreOffice Calc
Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015 Jul 26, 2014 Jul 27, 2013
Turnover Ratios
Inventory turnover 10.14 11.00 15.03 11.97 12.18 12.99
Receivables turnover 8.88 9.33 8.42 9.20 9.14 8.89
Payables turnover 9.83 12.84 17.32 17.64 18.77 18.63
Working capital turnover 1.42 0.86 0.92 0.93 1.00 1.12
Average No. of Days
Average inventory processing period 36 33 24 30 30 28
Add: Average receivable collection period 41 39 43 40 40 41
Operating cycle 77 72 67 70 70 69
Less: Average payables payment period 37 28 21 21 19 20
Cash conversion cycle 40 44 46 49 51 49

Based on: 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08), 10-K (filing date: 2014-09-09), 10-K (filing date: 2013-09-10).

Ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Cisco Systems Inc.'s inventory turnover deteriorated from 2016 to 2017 and from 2017 to 2018.
Receivables turnover An activity ratio equal to revenue divided by receivables. Cisco Systems Inc.'s receivables turnover improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018.
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. Cisco Systems Inc.'s payables turnover declined from 2016 to 2017 and from 2017 to 2018.
Working capital turnover An activity ratio calculated as revenue divided by working capital. Cisco Systems Inc.'s working capital turnover deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level.
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. Cisco Systems Inc.'s average inventory processing period deteriorated from 2016 to 2017 and from 2017 to 2018.
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnover.
Operating cycle Equal to average inventory processing period plus average receivables collection period. Cisco Systems Inc.'s operating cycle deteriorated from 2016 to 2017 and from 2017 to 2018.
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. Cisco Systems Inc.'s average payables payment period increased from 2016 to 2017 and from 2017 to 2018.
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. Cisco Systems Inc.'s cash conversion cycle improved from 2016 to 2017 and from 2017 to 2018.

Inventory Turnover

Cisco Systems Inc., inventory turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015 Jul 26, 2014 Jul 27, 2013
Selected Financial Data (USD $ in millions)
Cost of sales 18,724  17,781  18,287  19,480  19,373  19,167 
Inventories 1,846  1,616  1,217  1,627  1,591  1,476 
Ratio
Inventory turnover1 10.14 11.00 15.03 11.97 12.18 12.99
Benchmarks
Inventory Turnover, Competitors
Apple Inc. 41.39 29.05 61.62 59.64 53.18 60.43
Applied Materials Inc. 2.54 2.73 3.08 3.11 3.34 3.20
Broadcom Inc. – 6.31 5.21 6.24 4.61 4.64
HP Inc. 7.89 7.34 8.75 12.12 13.23 14.29
Intel Corp. – 3.39 4.18 4.00 4.74 5.08
NVIDIA Corp. 4.89 3.59 5.26 4.31 4.80 4.89
Qualcomm Inc. 6.05 4.81 6.27 6.96 7.33 7.54
Texas Instruments Inc. – 2.73 2.87 3.22 3.15 3.37
Inventory Turnover, Sector
Technology Hardware & Equipment – 9.16 11.79 13.20 13.06 13.81
Inventory Turnover, Industry
Technology – 12.01 14.71 14.88 14.87 15.79

Based on: 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08), 10-K (filing date: 2014-09-09), 10-K (filing date: 2013-09-10).

2018 Calculations

1 Inventory turnover = Cost of sales ÷ Inventories
= 18,724 ÷ 1,846 = 10.14

Ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Cisco Systems Inc.'s inventory turnover deteriorated from 2016 to 2017 and from 2017 to 2018.

Receivables Turnover

Cisco Systems Inc., receivables turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015 Jul 26, 2014 Jul 27, 2013
Selected Financial Data (USD $ in millions)
Revenue 49,330  48,005  49,247  49,161  47,142  48,607 
Accounts receivable, net of allowance for doubtful accounts 5,554  5,146  5,847  5,344  5,157  5,470 
Ratio
Receivables turnover1 8.88 9.33 8.42 9.20 9.14 8.89
Benchmarks
Receivables Turnover, Competitors
Apple Inc. 11.45 12.82 13.69 13.87 10.47 13.04
Applied Materials Inc. 6.73 6.22 4.75 5.55 5.43 4.60
Broadcom Inc. – 7.20 6.07 6.70 5.46 6.03
HP Inc. 11.44 11.79 11.73 7.73 8.06 7.07
Intel Corp. – 11.19 12.66 11.56 12.62 14.71
NVIDIA Corp. 7.68 8.37 9.92 9.88 9.69 9.42
Qualcomm Inc. 7.98 6.23 10.74 13.02 11.21 12.04
Texas Instruments Inc. – 11.71 10.55 11.16 10.47 10.15
Receivables Turnover, Sector
Technology Hardware & Equipment – 10.77 11.29 10.73 9.59 9.95
Receivables Turnover, Industry
Technology – 7.94 8.28 8.59 7.98 8.13

Based on: 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08), 10-K (filing date: 2014-09-09), 10-K (filing date: 2013-09-10).

2018 Calculations

1 Receivables turnover = Revenue ÷ Accounts receivable, net of allowance for doubtful accounts
= 49,330 ÷ 5,554 = 8.88

Ratio Description The company
Receivables turnover An activity ratio equal to revenue divided by receivables. Cisco Systems Inc.'s receivables turnover improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018.

Payables Turnover

Cisco Systems Inc., payables turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015 Jul 26, 2014 Jul 27, 2013
Selected Financial Data (USD $ in millions)
Cost of sales 18,724  17,781  18,287  19,480  19,373  19,167 
Accounts payable 1,904  1,385  1,056  1,104  1,032  1,029 
Ratio
Payables turnover1 9.83 12.84 17.32 17.64 18.77 18.63
Benchmarks
Payables Turnover, Competitors
Apple Inc. 2.93 2.88 3.52 3.95 3.72 4.77
Applied Materials Inc. 9.47 8.47 7.77 8.67 8.53 7.76
Broadcom Inc. – 8.26 5.79 5.30 4.64 4.76
HP Inc. 3.23 3.20 3.53 4.93 5.33 6.16
Intel Corp. – 8.09 9.37 10.02 7.37 7.14
NVIDIA Corp. 6.53 5.87 7.43 7.10 5.74 5.76
Qualcomm Inc. 5.61 4.97 5.25 7.98 4.90 6.32
Texas Instruments Inc. – 11.47 12.95 14.09 12.86 13.84
Payables Turnover, Sector
Technology Hardware & Equipment – 3.63 4.29 4.94 4.87 5.90
Payables Turnover, Industry
Technology – 4.44 5.04 5.44 5.27 6.19

Based on: 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08), 10-K (filing date: 2014-09-09), 10-K (filing date: 2013-09-10).

2018 Calculations

1 Payables turnover = Cost of sales ÷ Accounts payable
= 18,724 ÷ 1,904 = 9.83

Ratio Description The company
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. Cisco Systems Inc.'s payables turnover declined from 2016 to 2017 and from 2017 to 2018.

Working Capital Turnover

Cisco Systems Inc., working capital turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015 Jul 26, 2014 Jul 27, 2013
Selected Financial Data (USD $ in millions)
Current assets 61,837  83,703  78,719  76,283  67,114  65,521 
Less: Current liabilities 27,035  27,583  24,911  23,623  19,809  22,192 
Working capital 34,802  56,120  53,808  52,660  47,305  43,329 
Revenue 49,330  48,005  49,247  49,161  47,142  48,607 
Ratio
Working capital turnover1 1.42 0.86 0.92 0.93 1.00 1.12
Benchmarks
Working Capital Turnover, Competitors
Apple Inc. 18.35 8.24 7.74 26.66 35.96 5.77
Applied Materials Inc. 2.58 1.65 2.29 1.77 2.19 2.35
Broadcom Inc. – 1.33 3.27 2.57 1.51 1.81
HP Inc. – – – 10.77 17.39 23.19
Intel Corp. – 5.20 3.91 2.24 4.77 2.85
NVIDIA Corp. 1.20 1.02 1.35 0.97 0.88 1.13
Qualcomm Inc. 3.70 0.68 1.50 1.58 1.62 1.73
Texas Instruments Inc. – 2.31 2.57 2.88 2.55 2.32
Working Capital Turnover, Sector
Technology Hardware & Equipment – 2.86 3.38 3.88 4.38 3.51
Working Capital Turnover, Industry
Technology – 1.79 1.99 2.32 2.59 2.43

Based on: 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08), 10-K (filing date: 2014-09-09), 10-K (filing date: 2013-09-10).

2018 Calculations

1 Working capital turnover = Revenue ÷ Working capital
= 49,330 ÷ 34,802 = 1.42

Ratio Description The company
Working capital turnover An activity ratio calculated as revenue divided by working capital. Cisco Systems Inc.'s working capital turnover deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level.

Average Inventory Processing Period

Cisco Systems Inc., average inventory processing period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015 Jul 26, 2014 Jul 27, 2013
Selected Financial Data
Inventory turnover 10.14 11.00 15.03 11.97 12.18 12.99
Ratio (no. of days)
Average inventory processing period1 36 33 24 30 30 28
Benchmarks (no. of days)
Average Inventory Processing Period, Competitors
Apple Inc. 9 13 6 6 7 6
Applied Materials Inc. 144 134 119 117 109 114
Broadcom Inc. – 58 70 58 79 79
HP Inc. 46 50 42 30 28 26
Intel Corp. – 108 87 91 77 72
NVIDIA Corp. 75 102 69 85 76 75
Qualcomm Inc. 60 76 58 52 50 48
Texas Instruments Inc. – 134 127 113 116 108
Average Inventory Processing Period, Sector
Technology Hardware & Equipment – 40 31 28 28 26
Average Inventory Processing Period, Industry
Technology – 30 25 25 25 23

Based on: 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08), 10-K (filing date: 2014-09-09), 10-K (filing date: 2013-09-10).

2018 Calculations

1 Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 10.14 = 36

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. Cisco Systems Inc.'s average inventory processing period deteriorated from 2016 to 2017 and from 2017 to 2018.

Average Receivable Collection Period

Cisco Systems Inc., average receivable collection period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015 Jul 26, 2014 Jul 27, 2013
Selected Financial Data
Receivables turnover 8.88 9.33 8.42 9.20 9.14 8.89
Ratio (no. of days)
Average receivable collection period1 41 39 43 40 40 41
Benchmarks (no. of days)
Average Receivable Collection Period, Competitors
Apple Inc. 32 28 27 26 35 28
Applied Materials Inc. 54 59 77 66 67 79
Broadcom Inc. – 51 60 55 67 61
HP Inc. 32 31 31 47 45 52
Intel Corp. – 33 29 32 29 25
NVIDIA Corp. 48 44 37 37 38 39
Qualcomm Inc. 46 59 34 28 33 30
Texas Instruments Inc. – 31 35 33 35 36
Average Receivable Collection Period, Sector
Technology Hardware & Equipment – 34 32 34 38 37
Average Receivable Collection Period, Industry
Technology – 46 44 43 46 45

Based on: 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08), 10-K (filing date: 2014-09-09), 10-K (filing date: 2013-09-10).

2018 Calculations

1 Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 8.88 = 41

Ratio Description The company
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnover.

Operating Cycle

Cisco Systems Inc., operating cycle calculation, comparison to benchmarks

No. of days

Microsoft Excel LibreOffice Calc
Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015 Jul 26, 2014 Jul 27, 2013
Selected Financial Data
Average inventory processing period 36 33 24 30 30 28
Average receivable collection period 41 39 43 40 40 41
Ratio
Operating cycle1 77 72 67 70 70 69
Benchmarks
Operating Cycle, Competitors
Apple Inc. 41 41 33 32 42 34
Applied Materials Inc. 198 193 196 183 176 193
Broadcom Inc. – 109 130 113 146 140
HP Inc. 78 81 73 77 73 78
Intel Corp. – 141 116 123 106 97
NVIDIA Corp. 123 146 106 122 114 114
Qualcomm Inc. 106 135 92 80 83 78
Texas Instruments Inc. – 165 162 146 151 144
Operating Cycle, Sector
Technology Hardware & Equipment – 74 63 62 66 63
Operating Cycle, Industry
Technology – 76 69 68 71 68

Based on: 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08), 10-K (filing date: 2014-09-09), 10-K (filing date: 2013-09-10).

2018 Calculations

1 Operating cycle = Average inventory processing period + Average receivable collection period
= 36 + 41 = 77

Ratio Description The company
Operating cycle Equal to average inventory processing period plus average receivables collection period. Cisco Systems Inc.'s operating cycle deteriorated from 2016 to 2017 and from 2017 to 2018.

Average Payables Payment Period

Cisco Systems Inc., average payables payment period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015 Jul 26, 2014 Jul 27, 2013
Selected Financial Data
Payables turnover 9.83 12.84 17.32 17.64 18.77 18.63
Ratio (no. of days)
Average payables payment period1 37 28 21 21 19 20
Benchmarks (no. of days)
Average Payables Payment Period, Competitors
Apple Inc. 125 127 104 92 98 77
Applied Materials Inc. 39 43 47 42 43 47
Broadcom Inc. – 44 63 69 79 77
HP Inc. 113 114 103 74 68 59
Intel Corp. – 45 39 36 50 51
NVIDIA Corp. 56 62 49 51 64 63
Qualcomm Inc. 65 73 70 46 75 58
Texas Instruments Inc. – 32 28 26 28 26
Average Payables Payment Period, Sector
Technology Hardware & Equipment – 100 85 74 75 62
Average Payables Payment Period, Industry
Technology – 82 72 67 69 59

Based on: 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08), 10-K (filing date: 2014-09-09), 10-K (filing date: 2013-09-10).

2018 Calculations

1 Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 9.83 = 37

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. Cisco Systems Inc.'s average payables payment period increased from 2016 to 2017 and from 2017 to 2018.

Cash Conversion Cycle

Cisco Systems Inc., cash conversion cycle calculation, comparison to benchmarks

No. of days

Microsoft Excel LibreOffice Calc
Jul 28, 2018 Jul 29, 2017 Jul 30, 2016 Jul 25, 2015 Jul 26, 2014 Jul 27, 2013
Selected Financial Data
Average inventory processing period 36 33 24 30 30 28
Average receivable collection period 41 39 43 40 40 41
Average payables payment period 37 28 21 21 19 20
Ratio
Cash conversion cycle1 40 44 46 49 51 49
Benchmarks
Cash Conversion Cycle, Competitors
Apple Inc. -84 -86 -71 -60 -56 -43
Applied Materials Inc. 159 150 149 141 133 146
Broadcom Inc. – 65 67 44 67 63
HP Inc. -35 -33 -30 3 5 19
Intel Corp. – 96 77 87 56 46
NVIDIA Corp. 67 84 57 71 50 51
Qualcomm Inc. 41 62 22 34 8 20
Texas Instruments Inc. – 133 134 120 123 118
Cash Conversion Cycle, Sector
Technology Hardware & Equipment – -26 -22 -12 -9 1
Cash Conversion Cycle, Industry
Technology – -6 -3 1 2 9

Based on: 10-K (filing date: 2018-09-06), 10-K (filing date: 2017-09-07), 10-K (filing date: 2016-09-08), 10-K (filing date: 2015-09-08), 10-K (filing date: 2014-09-09), 10-K (filing date: 2013-09-10).

2018 Calculations

1 Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 36 + 41 – 37 = 40

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. Cisco Systems Inc.'s cash conversion cycle improved from 2016 to 2017 and from 2017 to 2018.