Analysis of Long-term (Investment) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
Long-term Activity Ratios (Summary)
Enphase Energy Inc., long-term (investment) activity ratios
Based on: 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), 10-K (reporting date: 2019-12-31).
The analysis of investment activity ratios from 2019 to 2023 reveals a general trend of fluctuating asset efficiency and a decline in the productivity of fixed assets toward the end of the period.
- Fixed Asset Utilization
- The net fixed asset turnover exhibited significant volatility, starting at 21.58 in 2019, declining through 2021, recovering to 20.93 in 2022, and subsequently dropping to 13.62 by 2023. A similar pattern is observed when including operating lease right-of-use assets, which peaked at 17.56 in 2022 before falling to 12.18 in 2023. This downward trajectory in the final year suggests a decrease in the efficiency with which fixed investments are being leveraged to generate revenue.
- Total Asset Efficiency
- Total asset turnover shows a contraction from a high of 0.88 in 2019 to a range between 0.65 and 0.76 over the subsequent four years, ending at 0.68 in 2023. The consistency of this ratio below the 2019 level indicates a moderate reduction in the overall ability of the asset base to drive sales growth.
- Equity Productivity
- Equity turnover demonstrated a sharp increase, peaking at 3.21 in 2021 from 1.60 in 2020. However, a steady decline followed, with the ratio receding to 2.82 in 2022 and 2.33 in 2023. This suggests that while the company achieved high efficiency in generating revenue from shareholder equity in 2021, that productivity has since diminished.
Overall, the data indicates that while there was a period of increased efficiency between 2021 and 2022, the 2023 figures reflect a broad decline across all measured activity ratios, pointing toward a reduction in the operational intensity of the company's long-term investments and equity.
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Net Fixed Asset Turnover
Enphase Energy Inc., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net revenues | 2,290,786) | 2,330,853) | 1,382,049) | 774,425) | 624,333) | |
| Property and equipment, net | 168,244) | 111,367) | 82,167) | 42,985) | 28,936) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | 13.62 | 20.93 | 16.82 | 18.02 | 21.58 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Advanced Micro Devices Inc. | 14.27 | 15.60 | 23.41 | — | — | |
| Analog Devices Inc. | 3.82 | 5.00 | 3.70 | 5.00 | — | |
| Applied Materials Inc. | 9.37 | 11.18 | 11.93 | 10.72 | — | |
| Broadcom Inc. | 16.63 | 14.94 | 11.69 | 9.52 | — | |
| Intel Corp. | 0.56 | 0.78 | 1.25 | — | — | |
| KLA Corp. | 10.17 | 10.84 | 10.44 | — | — | |
| Lam Research Corp. | 9.39 | 10.46 | 11.22 | — | — | |
| Marvell Technology Inc. | 10.25 | 9.64 | 9.10 | — | — | |
| Micron Technology Inc. | 0.41 | 0.80 | 0.83 | 0.69 | — | |
| NVIDIA Corp. | 7.09 | 9.69 | 7.76 | — | — | |
| Qualcomm Inc. | 7.10 | 8.55 | 7.36 | 6.34 | — | |
| Texas Instruments Inc. | 1.75 | 2.91 | 3.57 | — | — | |
| Net Fixed Asset Turnover, Sector | ||||||
| Semiconductors & Semiconductor Equipment | 1.69 | 2.13 | 2.33 | — | — | |
| Net Fixed Asset Turnover, Industry | ||||||
| Information Technology | 3.80 | 4.46 | 4.76 | — | — | |
Based on: 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), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Net fixed asset turnover = Net revenues ÷ Property and equipment, net
= 2,290,786 ÷ 168,244 = 13.62
2 Click competitor name to see calculations.
The analysis of the net fixed asset turnover from 2019 to 2023 reveals a volatile relationship between revenue generation and the expansion of the long-term asset base. While the organization experienced substantial top-line growth over the majority of the period, the consistent increase in investments in property and equipment has led to fluctuating levels of asset utilization efficiency.
- Revenue Trends
- Net revenues demonstrated strong growth from 624.3 million USD in 2019 to a peak of 2.33 billion USD in 2022. A slight contraction followed in 2023, with revenues ending at 2.29 billion USD.
- Fixed Asset Expansion
- Property and equipment, net, increased steadily every year throughout the period. The asset base grew from 28.9 million USD in 2019 to 168.2 million USD by the end of 2023, indicating a continuous strategy of increasing operational capacity and infrastructure investment.
- Net Fixed Asset Turnover Analysis
- The turnover ratio exhibited significant variance over the five-year span. An initial decline was observed between 2019 and 2021, as the ratio dropped from 21.58 to 16.82, suggesting that asset growth initially outpaced revenue gains. A sharp recovery occurred in 2022, with the ratio climbing to 20.93, driven by a surge in net revenues that maximized the productivity of the existing asset base. However, in 2023, the ratio fell to its lowest point of 13.62. This decline is the result of a dual impact: a marginal decrease in annual revenues coupled with a substantial increase in net fixed assets, signaling a period of underutilization of the newly expanded capacity.
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Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
Enphase Energy Inc., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net revenues | 2,290,786) | 2,330,853) | 1,382,049) | 774,425) | 624,333) | |
| Property and equipment, net | 168,244) | 111,367) | 82,167) | 42,985) | 28,936) | |
| Operating lease, right of use asset, net | 19,887) | 21,379) | 14,420) | 17,683) | 10,117) | |
| Property and equipment, net (including operating lease, right-of-use asset) | 188,131) | 132,746) | 96,587) | 60,668) | 39,053) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover (including operating lease, right-of-use asset)1 | 12.18 | 17.56 | 14.31 | 12.76 | 15.99 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Competitors2 | ||||||
| Advanced Micro Devices Inc. | 10.21 | 11.96 | 15.37 | — | — | |
| Analog Devices Inc. | 3.52 | 4.51 | 3.24 | 4.07 | — | |
| Applied Materials Inc. | 8.28 | 9.56 | 10.35 | 9.27 | — | |
| Broadcom Inc. | 13.69 | 12.12 | 9.35 | 7.71 | — | |
| Intel Corp. | 0.56 | 0.78 | 1.24 | — | — | |
| KLA Corp. | 8.46 | 9.43 | 9.03 | — | — | |
| Lam Research Corp. | 8.30 | 9.19 | 9.90 | — | — | |
| Marvell Technology Inc. | 7.51 | 7.38 | 6.94 | — | — | |
| Micron Technology Inc. | 0.40 | 0.78 | 0.82 | 0.68 | — | |
| NVIDIA Corp. | 5.57 | 7.46 | 5.84 | — | — | |
| Qualcomm Inc. | 6.34 | 7.62 | 6.62 | 5.64 | — | |
| Texas Instruments Inc. | 1.66 | 2.74 | 3.27 | — | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Semiconductors & Semiconductor Equipment | 1.63 | 2.06 | 2.24 | — | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Information Technology | 3.33 | 3.86 | 4.04 | — | — | |
Based on: 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), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset) = Net revenues ÷ Property and equipment, net (including operating lease, right-of-use asset)
= 2,290,786 ÷ 188,131 = 12.18
2 Click competitor name to see calculations.
The analysis of long-term investment activity reveals a period of substantial expansion in the asset base accompanied by fluctuating efficiency in revenue generation. While net revenues experienced significant growth between 2019 and 2022, the investment in net property and equipment, including right-of-use assets, followed a consistent upward trajectory throughout the entire five-year period.
- Net Fixed Asset Turnover Volatility
- The net fixed asset turnover ratio demonstrated a non-linear trend, starting at 15.99 in 2019 and fluctuating before reaching a peak of 17.56 in 2022. This peak reflects a period of high asset productivity, where revenue growth significantly outpaced the expansion of the fixed asset base. A prior dip to 12.76 in 2020 suggests a temporary misalignment between asset acquisition and revenue realization, followed by a steady recovery through 2022.
- Analysis of the 2023 Performance Decline
- A sharp decrease in the turnover ratio to 12.18 is observed in 2023, marking the lowest efficiency level in the reported period. This downturn is driven by a divergence between revenue and investment: net revenues declined slightly from 2.33 billion to 2.29 billion, while net property and equipment continued to increase significantly, rising from 132.7 million to 188.1 million. This indicates that the increase in the asset base has not yet yielded proportional revenue growth, suggesting a phase of capacity expansion or increased infrastructure investment that has yet to be fully optimized.
- Long-term Investment Correlation
- Over the five-year horizon, net property and equipment increased by approximately 382%, growing from 39.1 million to 188.1 million. Despite this aggressive expansion, the turnover ratio remained relatively high compared to typical industrial benchmarks, although the downward trend in the final year indicates a diminishing marginal return on fixed asset investments in the short term.
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Total Asset Turnover
Enphase Energy Inc., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net revenues | 2,290,786) | 2,330,853) | 1,382,049) | 774,425) | 624,333) | |
| Total assets | 3,383,012) | 3,084,280) | 2,079,256) | 1,200,102) | 713,223) | |
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | 0.68 | 0.76 | 0.66 | 0.65 | 0.88 | |
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Advanced Micro Devices Inc. | 0.33 | 0.35 | 1.32 | — | — | |
| Analog Devices Inc. | 0.25 | 0.24 | 0.14 | 0.26 | — | |
| Applied Materials Inc. | 0.86 | 0.96 | 0.89 | 0.77 | — | |
| Broadcom Inc. | 0.49 | 0.45 | 0.36 | 0.31 | — | |
| Intel Corp. | 0.28 | 0.35 | 0.47 | — | — | |
| KLA Corp. | 0.75 | 0.73 | 0.67 | — | — | |
| Lam Research Corp. | 0.93 | 1.00 | 0.92 | — | — | |
| Marvell Technology Inc. | 0.26 | 0.20 | 0.28 | — | — | |
| Micron Technology Inc. | 0.24 | 0.46 | 0.47 | 0.40 | — | |
| NVIDIA Corp. | 0.65 | 0.61 | 0.58 | — | — | |
| Qualcomm Inc. | 0.70 | 0.90 | 0.81 | 0.66 | — | |
| Texas Instruments Inc. | 0.54 | 0.74 | 0.74 | — | — | |
| Total Asset Turnover, Sector | ||||||
| Semiconductors & Semiconductor Equipment | 0.43 | 0.49 | 0.52 | — | — | |
| Total Asset Turnover, Industry | ||||||
| Information Technology | 0.61 | 0.64 | 0.62 | — | — | |
Based on: 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), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Total asset turnover = Net revenues ÷ Total assets
= 2,290,786 ÷ 3,383,012 = 0.68
2 Click competitor name to see calculations.
The analysis of the total asset turnover ratio reveals a period of volatility in operational efficiency between 2019 and 2023. While net revenues experienced substantial growth for much of the period, the expansion of the total asset base often occurred at a faster rate, impacting the overall efficiency of asset utilization.
- Revenue and Asset Growth Trends
- Net revenues grew aggressively from 624.3 million USD in 2019 to a peak of 2.33 billion USD in 2022, before experiencing a slight contraction to 2.29 billion USD in 2023. Concurrently, total assets increased steadily and significantly throughout the entire period, rising from 713.2 million USD in 2019 to 3.38 billion USD by the end of 2023. This consistent growth in the asset base indicates a sustained phase of capital investment.
- Total Asset Turnover Performance
- The asset turnover ratio decreased sharply from 0.88 in 2019 to 0.65 in 2020, indicating that asset accumulation outpaced revenue generation during that transition. A recovery was observed in 2022, where the ratio reached 0.76, aligning with the period of highest recorded revenue. However, this trend reversed in 2023, with the ratio declining to 0.68.
- Operational Efficiency Insights
- The decline in the ratio during 2023 resulted from a simultaneous decrease in net revenues and a continued increase in total assets. This suggests a reduction in the productivity of the company's investments, as the asset base grew by approximately 9.7% while revenues contracted by approximately 1.7% year-over-year, leading to a lower yield per unit of asset.
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Equity Turnover
Enphase Energy Inc., equity turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net revenues | 2,290,786) | 2,330,853) | 1,382,049) | 774,425) | 624,333) | |
| Stockholders’ equity | 983,624) | 825,573) | 430,168) | 483,993) | 272,212) | |
| Long-term Activity Ratio | ||||||
| Equity turnover1 | 2.33 | 2.82 | 3.21 | 1.60 | 2.29 | |
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Advanced Micro Devices Inc. | 0.41 | 0.43 | 2.19 | — | — | |
| Analog Devices Inc. | 0.35 | 0.33 | 0.19 | 0.47 | — | |
| Applied Materials Inc. | 1.62 | 2.11 | 1.88 | 1.63 | — | |
| Broadcom Inc. | 1.49 | 1.46 | 1.10 | 1.00 | — | |
| Intel Corp. | 0.51 | 0.62 | 0.83 | — | — | |
| KLA Corp. | 3.59 | 6.57 | 2.05 | — | — | |
| Lam Research Corp. | 2.12 | 2.74 | 2.43 | — | — | |
| Marvell Technology Inc. | 0.38 | 0.28 | 0.35 | — | — | |
| Micron Technology Inc. | 0.35 | 0.62 | 0.63 | 0.55 | — | |
| NVIDIA Corp. | 1.22 | 1.01 | 0.99 | — | — | |
| Qualcomm Inc. | 1.66 | 2.45 | 3.37 | 3.87 | — | |
| Texas Instruments Inc. | 1.04 | 1.37 | 1.38 | — | — | |
| Equity Turnover, Sector | ||||||
| Semiconductors & Semiconductor Equipment | 0.76 | 0.86 | 0.98 | — | — | |
| Equity Turnover, Industry | ||||||
| Information Technology | 1.54 | 1.71 | 1.77 | — | — | |
Based on: 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), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Equity turnover = Net revenues ÷ Stockholders’ equity
= 2,290,786 ÷ 983,624 = 2.33
2 Click competitor name to see calculations.
The financial trajectory from 2019 to 2023 indicates a period of rapid scaling followed by a stabilization phase, characterized by a significant expansion of both the revenue stream and the equity base.
- Net Revenue Trends
- A substantial growth pattern is observed between 2019 and 2022, with net revenues increasing from 624.3 million to a peak of 2.33 billion. In 2023, a slight contraction occurred, with revenues declining to 2.29 billion, suggesting a period of market stabilization or a cooling of previous growth rates.
- Stockholders' Equity Development
- The capital base grew consistently over the analyzed period, rising from 272.2 million in 2019 to 983.6 million in 2023. Aside from a minor dip in 2021, the steady increase in equity reflects a strengthening of the company's net asset position and a broader accumulation of retained earnings or capital contributions.
- Equity Turnover Analysis
- The equity turnover ratio demonstrates significant volatility in asset utilization efficiency. After an initial drop to 1.60 in 2020, the ratio surged to a peak of 3.21 in 2021, indicating a high capacity to generate sales relative to the invested equity. However, a downward trend followed, with the ratio falling to 2.82 in 2022 and 2.33 in 2023. This decline indicates that the growth in stockholders' equity has outpaced revenue growth in recent years, leading to a reduction in the efficiency of equity employment for revenue generation.
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