Analysis of Short-term (Operating) Activity Ratios
Quarterly Data
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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- Balance Sheet: Assets
- Cash Flow Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Geographic Areas
- Enterprise Value to FCFF (EV/FCFF)
- Capital Asset Pricing Model (CAPM)
- Dividend Discount Model (DDM)
- Selected Financial Data since 2005
- Price to Earnings (P/E) since 2005
- Analysis of Revenues
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Short-term Activity Ratios (Summary)
Paramount Global, short-term (operating) activity ratios (quarterly data)
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
The analysis of the quarterly financial ratios reveals several notable trends in the company's operational efficiency and liquidity management over the period assessed.
- Receivables Turnover
- The receivables turnover ratio initially increased significantly from 4.31 in March 2019 to a peak of 6.77 by September 2019, indicating improved efficiency in collection. Subsequently, it declined sharply to around 3.6 by the end of 2020 and fluctuated between approximately 3.58 and 4.56 through 2023, suggesting a reduction in the speed of receivables collection compared to early 2019 levels. Overall, there was a decline in the effectiveness of receivables management post-2019 peak.
- Payables Turnover
- The payables turnover ratio showed considerable volatility, peaking at 60.68 in June 2019, followed by a general declining trend with some fluctuations. From a high of over 60, the ratio fell to values mostly ranging between approximately 14 and 26 in 2021 and 2022, with a low of 14.14 in December 2022. This declining pattern suggests the company has been taking longer to pay its suppliers, indicating slower payables management or a more extended payment policy.
- Working Capital Turnover
- The working capital turnover ratio started strong at 7.97 in March 2019, spiked to 14.51 in March 2020, then dropped significantly to lows around 3.86-4.69 through late 2020 and 2021, indicating declining efficiency in generating sales from working capital during that period. In 2022 and into early 2023, the ratio improved substantially, reaching a peak of 22.09 by March 2023, which may reflect enhanced operational efficiency or changes in working capital structure driving higher sales relative to working capital invested.
- Average Receivable Collection Period
- This metric shows the average time taken to collect receivables in days, with a low of 54 days in September 2019, aligned with the high receivables turnover at that time. It lengthened sharply to over 100 days during 2020, maintaining near or above 90 days through to March 2023. This pattern parallels the decreasing receivables turnover ratio and confirms slower collections since 2020.
- Average Payables Payment Period
- The average payables payment period lengthened from single-digit days in early 2019 to a peak of 26 days in December 2022, indicating a trend toward longer payment durations. The increase suggests a shift toward extended payable terms or delayed payments, consistent with the observed decline in payables turnover ratios over the same period.
In summary, the data illustrates a decline in receivables turnover and an increase in average collection periods after 2019, indicating slower receivable collections. Concurrently, payables turnover declined, with a lengthening average payment period, pointing to extended payables management. Working capital turnover experienced volatility but showed a strong recovery from 2022 onward, potentially reflecting improved use of working capital or operational adjustments. These trends collectively suggest the company has become more conservative in managing cash outflows while facing challenges or strategic shifts in accelerating cash inflows from receivables.
Turnover Ratios
Average No. Days
Receivables Turnover
Paramount Global, receivables turnover calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||
| Receivables, net | |||||||||||||||||||||||
| Short-term Activity Ratio | |||||||||||||||||||||||
| Receivables turnover1 | |||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||
| Receivables Turnover, Competitors2 | |||||||||||||||||||||||
| Alphabet Inc. | |||||||||||||||||||||||
| Comcast Corp. | |||||||||||||||||||||||
| Meta Platforms Inc. | |||||||||||||||||||||||
| Trade Desk Inc. | |||||||||||||||||||||||
| Walt Disney Co. | |||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2023 Calculation
Receivables turnover
= (RevenuesQ1 2023
+ RevenuesQ4 2022
+ RevenuesQ3 2022
+ RevenuesQ2 2022)
÷ Receivables, net
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The quarterly financial data reveals notable trends in revenues, receivables, and receivables turnover over the observed periods.
- Revenues
- Revenues demonstrated fluctuating behavior across the quarters. Starting at 7,100 million US dollars at the beginning of 2019, revenues showed marginal growth and decline through the year, falling to a low of 5,837 million in the third quarter of 2020. From late 2020 onward, the revenues exhibited a partial recovery and upward trend, culminating in a peak of 8,131 million in the fourth quarter of 2022. More recently, in the first quarter of 2023, revenues decreased somewhat to 7,265 million, indicating some volatility in the revenue stream.
- Receivables, net
- Net receivables followed a pattern that generally reflected the revenue trends but with significant variations. The figure increased substantially from 3,685 million in the third quarter of 2019 to a striking 7,206 million in the fourth quarter of that year. Subsequently, receivables remained elevated, oscillating around 7,000 million without clear directional movement over the following quarters. This sustained high level of receivables compared to earlier periods suggests an accumulation or slower collection of amounts owed. By the first quarter of 2023, net receivables were 7,448 million, slightly higher than at the end of 2019.
- Receivables turnover ratio
- The receivables turnover ratio, a measure of how efficiently the company collects its receivables, exhibited a downward trend during the latter half of 2019, falling from 6.77 in the third quarter to 3.6 by the end of 2020. This decline corresponds inversely with the rise in net receivables seen in the same timeframe. From 2021 onwards, the ratio fluctuated modestly between approximately 3.6 and 4.5, indicating a relative stabilization but at a lower turnover level compared to early 2019. The lower turnover ratio suggests slower collection of receivables, consistent with the elevated net receivables balance.
Overall, the data indicates revenue volatility with a decline during mid-2020 period, probably impacted by external challenges, followed by a recovery phase. The receivables levels have remained high in recent years, while the receivables turnover ratio has decreased compared to earlier periods, pointing to potentially less efficient receivables collection practices or changes in credit terms. These trends merit further monitoring to assess their impact on liquidity and working capital management.
Payables Turnover
Paramount Global, payables turnover calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||
| Operating costs and expenses | |||||||||||||||||||||||
| Accounts payable | |||||||||||||||||||||||
| Short-term Activity Ratio | |||||||||||||||||||||||
| Payables turnover1 | |||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||
| Payables Turnover, Competitors2 | |||||||||||||||||||||||
| Alphabet Inc. | |||||||||||||||||||||||
| Comcast Corp. | |||||||||||||||||||||||
| Meta Platforms Inc. | |||||||||||||||||||||||
| Netflix Inc. | |||||||||||||||||||||||
| Trade Desk Inc. | |||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2023 Calculation
Payables turnover
= (Operating costs and expensesQ1 2023
+ Operating costs and expensesQ4 2022
+ Operating costs and expensesQ3 2022
+ Operating costs and expensesQ2 2022)
÷ Accounts payable
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The operating costs and expenses exhibit notable fluctuations over the observed periods. Beginning with a relatively high level in early 2019, there is a decline towards mid-2020, reaching a low point in June 2020. This is followed by a steady increase through the end of 2020 and into 2021, peaking at the end of 2021. Subsequently, the expenses oscillate without a consistent trend, showing both increases and reductions towards early 2023. The variability suggests responsiveness to operational conditions or external factors affecting expenditure.
Accounts payable demonstrate a general upward trend throughout the entire timeframe. Starting from a lower base at the start of 2019, accounts payable grow gradually with some moderate fluctuations. The most significant increases appear towards the latter half of 2022 and into the first quarter of 2023, indicating potentially extended credit terms or higher procurement activity on account.
The payables turnover ratio decreases markedly over the periods, highlighting a reduction in how frequently the payables are settled within the year. Initially, the ratio is quite high, suggesting rapid payment cycles early in 2019. However, there is a considerable decline through subsequent quarters, reaching the lowest levels near late 2022 and early 2023. This decline could indicate lengthening payment terms or slower payment processes, impacting liquidity or supplier relations.
- Operating Costs and Expenses
- Demonstrated volatility with a low in mid-2020 and peaks near end-2021 and late-2022, reflecting operational and possibly market-driven influences.
- Accounts Payable
- Showed a persistent increasing trend, with notable growth in late 2022 and early 2023, which could affect working capital management.
- Payables Turnover Ratio
- Experienced a significant downward trend, indicating slower payment cycles and potentially extended credit periods over time.
Working Capital Turnover
Paramount Global, working capital turnover calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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. | |||||||||||||||||||||||
| Trade Desk Inc. | |||||||||||||||||||||||
| Walt Disney Co. | |||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2023 Calculation
Working capital turnover
= (RevenuesQ1 2023
+ RevenuesQ4 2022
+ RevenuesQ3 2022
+ RevenuesQ2 2022)
÷ Working capital
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals notable fluctuations and evolving trends in working capital, revenues, and working capital turnover ratios over the examined periods.
- Working Capital
- The working capital values exhibit considerable volatility through the quarters. Initially, there is a moderate increase from 2,240 million USD in March 2019 to a peak near 5,483 million USD in December 2020. Subsequently, there is a significant decline, reaching 1,362 million USD by March 2023. This downward trend in working capital towards the latter periods suggests tightening liquidity or potentially reduced operational efficiency.
- Revenues
- Revenues demonstrate a pattern of oscillations with a general upward trajectory. Starting around 7,100 million USD in March 2019, revenues experience drops and recoveries but trend upwards, peaking at 8,131 million USD in December 2022. Despite some quarterly dips, the overall revenue trend suggests sustained business activity and market demand over the timeframe.
- Working Capital Turnover Ratio
- The working capital turnover ratio, calculated as revenues divided by working capital, inversely mirrors changes in working capital relative to revenue generation. Early periods show ratios around 7.97 to 11.61, which sharply declined to approximately 3.86 to 4.61 during late 2020, concurrent with the rise in working capital. From 2021 onward, the ratio steadily increases, reaching a high of 22.09 by March 2023. This upward trend implies greater efficiency in utilizing working capital to generate revenues, particularly in the most recent quarters despite lower absolute working capital values.
In summary, the data depicts a scenario where the company has managed to enhance its operational efficiency regarding working capital utilization while experiencing fluctuating but generally increasing revenue levels. The decline in working capital alongside rising turnover ratios may indicate an optimized approach to managing current assets and liabilities, though it also warrants monitoring to ensure liquidity remains sufficient to support operations.
Average Receivable Collection Period
Paramount Global, average receivable collection period calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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. | |||||||||||||||||||||||
| Trade Desk Inc. | |||||||||||||||||||||||
| Walt Disney Co. | |||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2023 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ =
2 Click competitor name to see calculations.
- Receivables Turnover Ratio
- The receivables turnover ratio exhibits considerable fluctuations over the reported periods, initially peaking in the third quarter of 2019 at 6.77 before declining sharply to 3.6 by the end of 2020. Throughout 2021, there is a modest recovery, with the ratio increasing to a maximum of 4.19 in the third quarter, followed by minor variations. In 2022, the ratio continues to fluctuate between approximately 3.9 and 4.6, ending around 4.04 in the first quarter of 2023. This pattern indicates periods of both efficient and reduced effectiveness in receivables collection over time.
- Average Receivable Collection Period
- The average receivable collection period shows an inverse relationship to the receivables turnover ratio, as expected. It starts relatively high at 85 days in the first quarter of 2019, decreases to a low of 54 days in the third quarter of 2019, and then increases sharply to above 100 days during 2020 and early 2021, signifying slower collections. In the subsequent quarters of 2021 and through 2022, the average collection period gradually decreases, reaching a low point of approximately 80 days in the third quarter of 2022. However, it slightly increases again to 90 days by the first quarter of 2023, indicating some recent deceleration in collections.
- Overall Trends and Insights
- The data reflects a notable deterioration in the efficiency of receivables collection around 2020, possibly linked to external factors impacting business operations during that period. Post-2020, there is a gradual improvement in collection efficiency, although the receivables turnover ratio and collection period have not returned to the high efficiency levels observed in early 2019. The stabilization and moderate improvements in 2021 and 2022 suggest some recovery in the company’s credit management effectiveness. However, the slight rise in the average collection period and the corresponding slight decline in turnover in early 2023 may warrant attention to ensure collection processes remain optimized.
Average Payables Payment Period
Paramount Global, average payables payment period calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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. | |||||||||||||||||||||||
| Trade Desk Inc. | |||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2023 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ =
2 Click competitor name to see calculations.
The analysis of the payables turnover ratio over the examined quarters reveals a general declining trend from 2019 through early 2023. Initially, the turnover ratio exhibited high variability, peaking at 60.68 in the second quarter of 2019 and then decreasing substantially to around the mid-twenties by 2020. This ratio remained relatively stable but low through 2021 and 2022, before dropping further to its lowest points in 2022 and early 2023, with values around 14 to 16. This downward movement indicates a slower rate of accounts payable turnover, suggesting lengthening payables management or extended payment terms over the period.
The average payables payment period, measured in number of days, inversely corresponds with the payables turnover trend. The payment period lengthened notably from 2019, where the shortest period was 6 days, increasing substantially to around 14-15 days in 2020, and continuing to rise through late 2022 and early 2023, reaching up to 26 days. This extension of the payment period corroborates the interpretation of slower payables turnover and indicates a strategic or operational shift toward longer credit terms, possibly to improve cash flow management or reflect supplier relationship changes.
- Payables Turnover
- Experienced significant fluctuation in early periods, with a peak in mid-2019 followed by a pronounced decline and stabilization at lower levels from 2020 onward.
- This suggests a trend toward slower payment cycles and reduced frequency of paying liabilities.
- Average Payables Payment Period
- Showed a consistent increase in the number of days on average, indicating that the company took progressively longer to settle its payables.
- The increase in payment days matches the decline in the turnover ratio, confirming extended payment terms or slower payments.
- Overall Insights
- The simultaneous decrease in payables turnover and increase in payment period suggest a deliberate or necessary change in payables management, possibly to optimize working capital or respond to external financial pressures.
- Such patterns may impact supplier relationships and creditworthiness, warranting monitoring and further analysis within the broader context of liquidity and operational strategies.