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.
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Long-term Activity Ratios (Summary)
Etsy Inc., long-term (investment) activity ratios
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Net fixed asset turnover | ||||||
| Net fixed asset turnover (including operating lease, right-of-use asset) | ||||||
| Total asset turnover | ||||||
| Equity turnover |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio showed a significant increase from 3.75 in 2017 to a peak of 15.34 in 2020, indicating improved efficiency in using fixed assets to generate sales during this period. However, in 2021, this ratio declined to 8.47, suggesting a decrease in asset utilization efficiency compared to the previous year but still remaining above earlier years.
- Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)
- This adjusted ratio follows a similar trend as the net fixed asset turnover, rising from 3.75 in 2017 to 13.07 in 2020, then declining to 7.26 in 2021. The slightly lower values compared to the unadjusted ratio reflect the impact of including operating leases, indicating that leasing assets influence turnover efficiency measurements.
- Total Asset Turnover
- The total asset turnover ratio experienced a decline from 0.73 in 2017 to 0.53 in 2019, signaling a reduction in the ability to generate revenue from total assets during those years. It recovered to 0.72 in 2020 but dropped again to 0.61 in 2021. Overall, the trend suggests fluctuating but generally moderate efficiency in asset utilization for revenue generation.
- Equity Turnover
- The equity turnover ratio increased steadily over the period, starting at 1.11 in 2017 and reaching 3.71 in 2021. This consistent upward trend indicates a progressive enhancement in using shareholder equity to generate sales, reflecting increasing operational efficiency or higher leverage.
Net Fixed Asset Turnover
Etsy Inc., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | ||||||
| Property and equipment, net | ||||||
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | ||||||
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Amazon.com Inc. | ||||||
| Home Depot Inc. | ||||||
| Lowe’s Cos. Inc. | ||||||
| TJX Cos. Inc. | ||||||
| Net Fixed Asset Turnover, Sector | ||||||
| Consumer Discretionary Distribution & Retail | ||||||
| Net Fixed Asset Turnover, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Net fixed asset turnover = Revenue ÷ Property and equipment, net
= ÷ =
2 Click competitor name to see calculations.
- Revenue Trends
- The revenue exhibits a consistently increasing trend over the five-year period. Starting from approximately $441 million in 2017, it grows steadily each year, reaching around $2.33 billion by the end of 2021. Notably, the revenue more than doubles between 2019 and 2020, indicating significant expansion in that one-year interval, while the growth continues robustly thereafter.
- Property and Equipment, Net
- The net value of property and equipment shows moderate fluctuations over the years. Beginning at approximately $118 million in 2017, the figure rises slightly up to $145 million in 2019 before declining to about $112 million in 2020. A considerable increase occurs by 2021, reaching $275 million, more than doubling the prior year’s value. This jump in 2021 suggests a major investment or acquisition in fixed assets during that year.
- Net Fixed Asset Turnover Ratio
- The ratio displays significant variability across the period. Initially, it increases from 3.75 in 2017 to a peak of 15.34 in 2020, indicating improved efficiency in generating revenue relative to fixed assets. However, it declines in 2021 to 8.47, which while lower than the 2020 peak, still reflects a strong turnover ratio overall. The spike in 2020 suggests that revenue growth outpaced the asset base significantly that year, whereas the subsequent decline corresponds with the substantial increase in fixed assets in 2021, diluting the turnover ratio.
- Combined Insights
- The data reveals a period of rapid revenue growth from 2019 to 2020, accompanied by a rise in asset utilization efficiency as reflected in the increasing net fixed asset turnover ratio. The following year, the company appears to have invested heavily in property and equipment, as indicated by the more than doubling asset base in 2021, which in turn moderated the turnover ratio. Despite this, revenue continues to grow substantially, suggesting strategic asset expansion to support larger operational scale.
Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
Etsy Inc., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | ||||||
| Property and equipment, net | ||||||
| Operating lease right-of-use (ROU) assets (included in Other assets) | ||||||
| Property 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 | ||||||
| Amazon.com Inc. | ||||||
| Home Depot Inc. | ||||||
| Lowe’s Cos. Inc. | ||||||
| TJX Cos. Inc. | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Consumer Discretionary Distribution & Retail | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset) = Revenue ÷ Property and equipment, net (including operating lease, right-of-use asset)
= ÷ =
2 Click competitor name to see calculations.
- Revenue Trends
- Revenue demonstrates a consistent upward trajectory over the analyzed period. Starting at approximately 441 million US dollars at the end of 2017, it increased steadily each year, reaching over 2.3 billion US dollars by the end of 2021. The most significant growth occurred between 2019 and 2020, where revenue more than doubled from about 818 million to 1.7 billion US dollars, indicative of a possibly accelerated business expansion or market demand.
- Property and Equipment, Net
- The net value of property and equipment (including operating lease and right-of-use assets) shows a less consistent trend compared to revenue. Initially, the asset base held steady around 117-120 million US dollars in 2017 and 2018, before rising significantly to over 169 million in 2019. However, there was a decline in 2020, dropping to approximately 132 million, followed by a sharp increase to over 321 million at the end of 2021. This pattern suggests fluctuating capital expenditure or asset revaluation activities, with a notable investment or asset acquisition in 2021.
- Net Fixed Asset Turnover
- Net fixed asset turnover, a ratio indicating how efficiently the company generates revenue from its fixed assets, fluctuates markedly across the years. The ratio improved from 3.75 in 2017 to 5.02 in 2018, signaling enhanced asset utilization. There was a slight dip to 4.84 in 2019, followed by a sharp increase to 13.07 in 2020, indicating highly efficient use of fixed assets coinciding with the rapid revenue growth of that year. However, this efficiency declined to 7.26 in 2021, although this level remains higher than all years except 2020. These fluctuations may reflect changes in operational efficiency, asset base management, or shifts in the business model impacting the asset turnover.
Total Asset Turnover
Etsy Inc., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | ||||||
| Total assets | ||||||
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | ||||||
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Amazon.com Inc. | ||||||
| Home Depot Inc. | ||||||
| Lowe’s Cos. Inc. | ||||||
| TJX Cos. Inc. | ||||||
| Total Asset Turnover, Sector | ||||||
| Consumer Discretionary Distribution & Retail | ||||||
| Total Asset Turnover, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Total asset turnover = Revenue ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
- Revenue
- The annual revenue shows a consistent upward trend over the five-year period. Starting at approximately $441 million in 2017, revenue increased significantly each year, reaching around $2.33 billion by the end of 2021. The most notable growth occurred between 2019 and 2020, where revenue more than doubled, indicating strong business expansion or market demand growth during that period.
- Total Assets
- Total assets also exhibited significant growth throughout the period. Beginning at about $606 million in 2017, assets nearly doubled by 2019 and continued to expand, reaching over $3.8 billion by the end of 2021. This steady increase suggests ongoing investment in resources and capacity, reflecting the company's scaling operations and potentially increased capital expenditures or acquisitions.
- Total Asset Turnover
- The total asset turnover ratio experienced fluctuations over the years. Starting at 0.73 in 2017, it declined to 0.67 in 2018 and further dropped to its lowest point of 0.53 in 2019. In 2020, the ratio rebounded to 0.72, followed by a decline to 0.61 in 2021. The initial decrease might indicate that asset growth outpaced revenue growth during those years. The recovery in 2020 suggests improved efficiency in using assets to generate revenue amid rapid business expansion; however, the decline in 2021 could reflect the continued growth in assets not fully matched by revenue increases, which could imply a temporary dip in operational efficiency or a strategic investment phase.
Equity Turnover
Etsy Inc., equity turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenue | ||||||
| Stockholders’ equity | ||||||
| Long-term Activity Ratio | ||||||
| Equity turnover1 | ||||||
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Amazon.com Inc. | ||||||
| Home Depot Inc. | ||||||
| Lowe’s Cos. Inc. | ||||||
| TJX Cos. Inc. | ||||||
| Equity Turnover, Sector | ||||||
| Consumer Discretionary Distribution & Retail | ||||||
| Equity Turnover, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Equity turnover = Revenue ÷ Stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
- Revenue
- There is a clear and substantial upward trend in revenue over the five-year period. Starting from approximately $441 million in 2017, revenue nearly doubled by 2019, reaching over $818 million. This positive trajectory continues sharply through 2020 and 2021, with revenue peaking at around $2.33 billion in 2021. The data indicates strong growth momentum, particularly notable in 2020 and 2021, reflecting possibly expanded operations or market reach.
- Stockholders’ Equity
- Stockholders’ equity shows a more moderate and less consistent pattern. From 2017 to 2019, equity increased slightly from about $397 million to $407 million, indicating stability. In 2020, equity experienced a significant jump to approximately $742 million. However, in 2021, equity declined to around $629 million. This suggests that while the company increased its net assets significantly at the start of the pandemic period, there was a reduction following that increase, which may warrant further investigation regarding capital structure changes or distributions.
- Equity Turnover Ratio
- The equity turnover ratio shows a strong increasing trend, rising from 1.11 in 2017 to 3.71 in 2021. This indicates that the company has been generating increasingly higher revenue per dollar of equity. The rise in this ratio aligns with the rapid revenue growth and relatively smaller growth in equity, suggesting improved efficiency in using shareholders’ funds to generate sales. The notably higher ratio in 2021 reflects particularly high revenue relative to equity.
- Overall Observations
- The analysis reveals robust revenue growth accompanied by a fluctuating equity base. The significant increase in the equity turnover ratio suggests that the company has been leveraging its equity more effectively to enhance revenues. The dip in equity in 2021, despite continued revenue growth, could imply changes in financing or profit retention strategies. The company appears to be in a growth phase with improving operational efficiency as indicated by rising equity turnover.