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.
Short-term Activity Ratios (Summary)
T-Mobile US Inc., short-term (operating) activity ratios
Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).
Short-term activity ratio | Description | The company |
---|---|---|
Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | T-Mobile US Inc.’s inventory turnover ratio improved from 2017 to 2018 and from 2018 to 2019. |
Receivables turnover | An activity ratio equal to revenue divided by receivables. | T-Mobile US Inc.’s receivables turnover ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019. |
Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | T-Mobile US Inc.’s payables turnover ratio increased from 2017 to 2018 and from 2018 to 2019. |
Short-term activity 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. | T-Mobile US Inc.’s number of days of inventory outstanding improved from 2017 to 2018 and from 2018 to 2019. |
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. | T-Mobile US Inc.’s operating cycle improved from 2017 to 2018 and from 2018 to 2019. |
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. | T-Mobile US Inc.’s number of days of payables outstanding decreased from 2017 to 2018 and from 2018 to 2019. |
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. | T-Mobile US Inc.’s cash conversion cycle deteriorated from 2017 to 2018 and from 2018 to 2019. |
Inventory Turnover
T-Mobile US Inc., inventory turnover calculation, comparison to benchmarks
Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).
1 2019 Calculation
Inventory turnover = Cost of revenues ÷ Inventories
= 18,521 ÷ 964 = 19.21
Short-term activity ratio | Description | The company |
---|---|---|
Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | T-Mobile US Inc.’s inventory turnover ratio improved from 2017 to 2018 and from 2018 to 2019. |
Receivables Turnover
T-Mobile US Inc., receivables turnover calculation, comparison to benchmarks
Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).
1 2019 Calculation
Receivables turnover = Revenues ÷ Accounts receivable, net of allowances
= 44,998 ÷ 1,888 = 23.83
Short-term activity ratio | Description | The company |
---|---|---|
Receivables turnover | An activity ratio equal to revenue divided by receivables. | T-Mobile US Inc.’s receivables turnover ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019. |
Payables Turnover
T-Mobile US Inc., payables turnover calculation, comparison to benchmarks
Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).
1 2019 Calculation
Payables turnover = Cost of revenues ÷ Accounts payable
= 18,521 ÷ 4,322 = 4.29
Short-term activity ratio | Description | The company |
---|---|---|
Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | T-Mobile US Inc.’s payables turnover ratio increased from 2017 to 2018 and from 2018 to 2019. |
Working Capital Turnover
T-Mobile US Inc., working capital turnover calculation, comparison to benchmarks
Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).
1 2019 Calculation
Working capital turnover = Revenues ÷ Working capital
= 44,998 ÷ -3,201 = —
Average Inventory Processing Period
T-Mobile US Inc., average inventory processing period calculation, comparison to benchmarks
Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).
1 2019 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 19.21 = 19
Short-term activity 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. | T-Mobile US Inc.’s number of days of inventory outstanding improved from 2017 to 2018 and from 2018 to 2019. |
Average Receivable Collection Period
T-Mobile US Inc., average receivable collection period calculation, comparison to benchmarks
Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).
1 2019 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 23.83 = 15
Short-term activity 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
T-Mobile US Inc., operating cycle calculation, comparison to benchmarks
No. days
Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).
1 2019 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 19 + 15 = 34
Short-term activity ratio | Description | The company |
---|---|---|
Operating cycle | Equal to average inventory processing period plus average receivables collection period. | T-Mobile US Inc.’s operating cycle improved from 2017 to 2018 and from 2018 to 2019. |
Average Payables Payment Period
T-Mobile US Inc., average payables payment period calculation, comparison to benchmarks
Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).
1 2019 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 4.29 = 85
Short-term activity 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. | T-Mobile US Inc.’s number of days of payables outstanding decreased from 2017 to 2018 and from 2018 to 2019. |
Cash Conversion Cycle
T-Mobile US Inc., cash conversion cycle calculation, comparison to benchmarks
No. days
Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).
1 2019 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 19 + 15 – 85 = -51
Short-term activity 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. | T-Mobile US Inc.’s cash conversion cycle deteriorated from 2017 to 2018 and from 2018 to 2019. |