Microsoft Excel LibreOffice Calc

T-Mobile US Inc. (TMUS)

Analysis of Short-term (Operating) Activity Ratios

Beginner level

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

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Turnover Ratios
Inventory turnover 16.93 11.31 14.90 11.50 14.20
Receivables turnover 24.48 21.20 19.64 17.93 15.85
Payables turnover 3.34 2.86 3.21 2.43 2.90
Working capital turnover — — 7.17 5.98 5.68
Average No. Days
Average inventory processing period 22 32 25 32 26
Add: Average receivable collection period 15 17 19 20 23
Operating cycle 37 49 44 52 49
Less: Average payables payment period 109 127 114 150 126
Cash conversion cycle -72 -78 -70 -98 -77

Based on: 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), 10-K (filing date: 2015-02-19).

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 deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level.
Receivables turnover An activity ratio equal to revenue divided by receivables. T-Mobile US Inc.’s receivables turnover ratio improved from 2016 to 2017 and from 2017 to 2018.
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. T-Mobile US Inc.’s payables turnover ratio decreased from 2016 to 2017 but then increased from 2017 to 2018 exceeding 2016 level.
Working capital turnover An activity ratio calculated as revenue divided by working capital.
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 deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level.
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnover. T-Mobile US Inc.’s number of days of receivables outstanding improved from 2016 to 2017 and from 2017 to 2018.
Operating cycle Equal to average inventory processing period plus average receivables collection period. T-Mobile US Inc.’s operating cycle deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level.
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 increased from 2016 to 2017 but then decreased significantly 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. T-Mobile US Inc.’s cash conversion cycle improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018 not reaching 2016 level.

Inventory Turnover

T-Mobile US Inc., inventory turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (US$ in millions)
Cost of revenues 18,354  17,708  16,550  14,898  15,409 
Inventories 1,084  1,566  1,111  1,295  1,085 
Short-term Activity Ratio
Inventory turnover1 16.93 11.31 14.90 11.50 14.20
Benchmarks
Inventory Turnover, Industry
Telecommunications 29.53 30.39 33.29 20.44 30.20

Based on: 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), 10-K (filing date: 2015-02-19).

1 2018 Calculation
Inventory turnover = Cost of revenues ÷ Inventories
= 18,354 ÷ 1,084 = 16.93

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 deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level.

Receivables Turnover

T-Mobile US Inc., receivables turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (US$ in millions)
Revenues 43,310  40,604  37,242  32,053  29,564 
Accounts receivable, net of allowances 1,769  1,915  1,896  1,788  1,865 
Short-term Activity Ratio
Receivables turnover1 24.48 21.20 19.64 17.93 15.85
Benchmarks
Receivables Turnover, Industry
Telecommunications 6.47 7.80 9.03 9.77 9.51

Based on: 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), 10-K (filing date: 2015-02-19).

1 2018 Calculation
Receivables turnover = Revenues ÷ Accounts receivable, net of allowances
= 43,310 ÷ 1,769 = 24.48

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 2016 to 2017 and from 2017 to 2018.

Payables Turnover

T-Mobile US Inc., payables turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (US$ in millions)
Cost of revenues 18,354  17,708  16,550  14,898  15,409 
Accounts payable 5,487  6,182  5,163  6,137  5,322 
Short-term Activity Ratio
Payables turnover1 3.34 2.86 3.21 2.43 2.90
Benchmarks
Payables Turnover, Industry
Telecommunications 3.86 3.89 4.23 4.01 4.86

Based on: 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), 10-K (filing date: 2015-02-19).

1 2018 Calculation
Payables turnover = Cost of revenues ÷ Accounts payable
= 18,354 ÷ 5,487 = 3.34

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 decreased from 2016 to 2017 but then increased from 2017 to 2018 exceeding 2016 level.

Working Capital Turnover

T-Mobile US Inc., working capital turnover calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (US$ in millions)
Current assets 8,281  8,915  14,217  14,890  13,984 
Less: Current liabilities 10,267  11,515  9,022  9,528  8,776 
Working capital (1,986) (2,600) 5,195  5,362  5,208 
 
Revenues 43,310  40,604  37,242  32,053  29,564 
Short-term Activity Ratio
Working capital turnover1 — — 7.17 5.98 5.68
Benchmarks
Working Capital Turnover, Industry
Telecommunications — — — — 191.07

Based on: 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), 10-K (filing date: 2015-02-19).

1 2018 Calculation
Working capital turnover = Revenues ÷ Working capital
= 43,310 ÷ -1,986 = —

Short-term activity ratio Description The company
Working capital turnover An activity ratio calculated as revenue divided by working capital.

Average Inventory Processing Period

T-Mobile US Inc., average inventory processing period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data
Inventory turnover 16.93 11.31 14.90 11.50 14.20
Short-term Activity Ratio (no. days)
Average inventory processing period1 22 32 25 32 26
Benchmarks (no. days)
Average Inventory Processing Period, Industry
Telecommunications 12 12 11 18 12

Based on: 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), 10-K (filing date: 2015-02-19).

1 2018 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 16.93 = 22

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 deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level.

Average Receivable Collection Period

T-Mobile US Inc., average receivable collection period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data
Receivables turnover 24.48 21.20 19.64 17.93 15.85
Short-term Activity Ratio (no. days)
Average receivable collection period1 15 17 19 20 23
Benchmarks (no. days)
Average Receivable Collection Period, Industry
Telecommunications 56 47 40 37 38

Based on: 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), 10-K (filing date: 2015-02-19).

1 2018 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 24.48 = 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. T-Mobile US Inc.’s number of days of receivables outstanding improved from 2016 to 2017 and from 2017 to 2018.

Operating Cycle

T-Mobile US Inc., operating cycle calculation, comparison to benchmarks

No. days

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data
Average inventory processing period 22 32 25 32 26
Average receivable collection period 15 17 19 20 23
Short-term Activity Ratio
Operating cycle1 37 49 44 52 49
Benchmarks
Operating Cycle, Industry
Telecommunications 68 59 51 55 50

Based on: 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), 10-K (filing date: 2015-02-19).

1 2018 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 22 + 15 = 37

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 deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level.

Average Payables Payment Period

T-Mobile US Inc., average payables payment period calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data
Payables turnover 3.34 2.86 3.21 2.43 2.90
Short-term Activity Ratio (no. days)
Average payables payment period1 109 127 114 150 126
Benchmarks (no. days)
Average Payables Payment Period, Industry
Telecommunications 95 94 86 91 75

Based on: 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), 10-K (filing date: 2015-02-19).

1 2018 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 3.34 = 109

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 increased from 2016 to 2017 but then decreased significantly from 2017 to 2018.

Cash Conversion Cycle

T-Mobile US Inc., cash conversion cycle calculation, comparison to benchmarks

No. days

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data
Average inventory processing period 22 32 25 32 26
Average receivable collection period 15 17 19 20 23
Average payables payment period 109 127 114 150 126
Short-term Activity Ratio
Cash conversion cycle1 -72 -78 -70 -98 -77
Benchmarks
Cash Conversion Cycle, Industry
Telecommunications -27 -35 -35 -36 -25

Based on: 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), 10-K (filing date: 2015-02-19).

1 2018 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 22 + 15 – 109 = -72

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 improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018 not reaching 2016 level.