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)
AT&T Inc., short-term (operating) activity ratios
Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-20), 10-K (filing date: 2017-02-17), 10-K (filing date: 2016-02-18).
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | AT&T Inc.’s inventory turnover ratio deteriorated from 2017 to 2018 but then slightly improved from 2018 to 2019. |
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | AT&T Inc.’s receivables turnover ratio deteriorated from 2017 to 2018 but then slightly improved from 2018 to 2019. |
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | AT&T Inc.’s payables turnover ratio decreased from 2017 to 2018 and from 2018 to 2019. |
| 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. | AT&T Inc.’s number of days of inventory outstanding deteriorated from 2017 to 2018 but then slightly improved from 2018 to 2019. |
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | AT&T Inc.’s number of days of receivables outstanding deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level. |
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | AT&T Inc.’s operating cycle deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 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. | AT&T Inc.’s number of days of payables outstanding increased 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. | AT&T Inc.’s cash conversion cycle deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level. |
Inventory Turnover
AT&T Inc., inventory turnover calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cost of revenues | 84,141 | 79,419 | 77,379 | 76,884 | 67,046 | |
| Equipment inventories | 2,864 | 2,771 | 2,225 | 2,039 | 4,033 | |
| Short-term Activity Ratio | ||||||
| Inventory turnover1 | 29.38 | 28.66 | 34.78 | 37.71 | 16.62 | |
| Benchmarks | ||||||
| Inventory Turnover, Competitors2 | ||||||
| Verizon Communications Inc. | 38.49 | 41.55 | 49.86 | 42.78 | 41.98 | |
| Inventory Turnover, Sector | ||||||
| Fixed Line Telecommunications | 32.40 | 32.85 | 39.56 | 39.59 | 22.63 | |
| Inventory Turnover, Industry | ||||||
| Telecommunications | 29.98 | 29.53 | 30.39 | 33.29 | 20.44 | |
Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-20), 10-K (filing date: 2017-02-17), 10-K (filing date: 2016-02-18).
1 2019 Calculation
Inventory turnover = Cost of revenues ÷ Equipment inventories
= 84,141 ÷ 2,864 = 29.38
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | AT&T Inc.’s inventory turnover ratio deteriorated from 2017 to 2018 but then slightly improved from 2018 to 2019. |
Receivables Turnover
AT&T Inc., receivables turnover calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating revenues | 181,193 | 170,756 | 160,546 | 163,786 | 146,801 | |
| Accounts receivable, net of allowances for doubtful accounts | 22,636 | 26,472 | 16,522 | 16,794 | 16,532 | |
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | 8.00 | 6.45 | 9.72 | 9.75 | 8.88 | |
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Verizon Communications Inc. | 5.19 | 5.21 | 5.36 | 7.19 | 9.78 | |
| Receivables Turnover, Sector | ||||||
| Fixed Line Telecommunications | 6.51 | 5.85 | 7.16 | 8.45 | 9.28 | |
| Receivables Turnover, Industry | ||||||
| Telecommunications | 7.17 | 6.47 | 7.80 | 9.03 | 9.77 | |
Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-20), 10-K (filing date: 2017-02-17), 10-K (filing date: 2016-02-18).
1 2019 Calculation
Receivables turnover = Operating revenues ÷ Accounts receivable, net of allowances for doubtful accounts
= 181,193 ÷ 22,636 = 8.00
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | AT&T Inc.’s receivables turnover ratio deteriorated from 2017 to 2018 but then slightly improved from 2018 to 2019. |
Payables Turnover
AT&T Inc., payables turnover calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cost of revenues | 84,141 | 79,419 | 77,379 | 76,884 | 67,046 | |
| Accounts payable | 29,640 | 27,018 | 24,439 | 22,027 | 21,047 | |
| Short-term Activity Ratio | ||||||
| Payables turnover1 | 2.84 | 2.94 | 3.17 | 3.49 | 3.19 | |
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Verizon Communications Inc. | 7.08 | 7.68 | 7.30 | 7.26 | 8.22 | |
| Payables Turnover, Sector | ||||||
| Fixed Line Telecommunications | 3.72 | 3.94 | 4.09 | 4.41 | 4.36 | |
| Payables Turnover, Industry | ||||||
| Telecommunications | 3.78 | 3.86 | 3.89 | 4.23 | 4.01 | |
Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-20), 10-K (filing date: 2017-02-17), 10-K (filing date: 2016-02-18).
1 2019 Calculation
Payables turnover = Cost of revenues ÷ Accounts payable
= 84,141 ÷ 29,640 = 2.84
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | AT&T Inc.’s payables turnover ratio decreased from 2017 to 2018 and from 2018 to 2019. |
Working Capital Turnover
AT&T Inc., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | 54,761 | 51,427 | 79,146 | 38,369 | 35,992 | |
| Less: Current liabilities | 68,911 | 64,420 | 81,389 | 50,576 | 47,816 | |
| Working capital | (14,150) | (12,993) | (2,243) | (12,207) | (11,824) | |
| Operating revenues | 181,193 | 170,756 | 160,546 | 163,786 | 146,801 | |
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | — | — | — | — | — | |
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Verizon Communications Inc. | — | — | — | — | — | |
| Working Capital Turnover, Sector | ||||||
| Fixed Line Telecommunications | — | — | — | — | — | |
| Working Capital Turnover, Industry | ||||||
| Telecommunications | — | — | — | — | — | |
Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-20), 10-K (filing date: 2017-02-17), 10-K (filing date: 2016-02-18).
1 2019 Calculation
Working capital turnover = Operating revenues ÷ Working capital
= 181,193 ÷ -14,150 = —
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. |
Average Inventory Processing Period
AT&T Inc., average inventory processing period calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Inventory turnover | 29.38 | 28.66 | 34.78 | 37.71 | 16.62 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average inventory processing period1 | 12 | 13 | 10 | 10 | 22 | |
| Benchmarks (no. days) | ||||||
| Average Inventory Processing Period, Competitors2 | ||||||
| Verizon Communications Inc. | 9 | 9 | 7 | 9 | 9 | |
| Average Inventory Processing Period, Sector | ||||||
| Fixed Line Telecommunications | 11 | 11 | 9 | 9 | 16 | |
| Average Inventory Processing Period, Industry | ||||||
| Telecommunications | 12 | 12 | 12 | 11 | 18 | |
Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-20), 10-K (filing date: 2017-02-17), 10-K (filing date: 2016-02-18).
1 2019 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 29.38 = 12
2 Click competitor name to see calculations.
| 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. | AT&T Inc.’s number of days of inventory outstanding deteriorated from 2017 to 2018 but then slightly improved from 2018 to 2019. |
Average Receivable Collection Period
AT&T Inc., average receivable collection period calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | 8.00 | 6.45 | 9.72 | 9.75 | 8.88 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | 46 | 57 | 38 | 37 | 41 | |
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Verizon Communications Inc. | 70 | 70 | 68 | 51 | 37 | |
| Average Receivable Collection Period, Sector | ||||||
| Fixed Line Telecommunications | 56 | 62 | 51 | 43 | 39 | |
| Average Receivable Collection Period, Industry | ||||||
| Telecommunications | 51 | 56 | 47 | 40 | 37 | |
Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-20), 10-K (filing date: 2017-02-17), 10-K (filing date: 2016-02-18).
1 2019 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 8.00 = 46
2 Click competitor name to see calculations.
| 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. | AT&T Inc.’s number of days of receivables outstanding deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level. |
Operating Cycle
AT&T Inc., operating cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 12 | 13 | 10 | 10 | 22 | |
| Average receivable collection period | 46 | 57 | 38 | 37 | 41 | |
| Short-term Activity Ratio | ||||||
| Operating cycle1 | 58 | 70 | 48 | 47 | 63 | |
| Benchmarks | ||||||
| Operating Cycle, Competitors2 | ||||||
| Verizon Communications Inc. | 79 | 79 | 75 | 60 | 46 | |
| Operating Cycle, Sector | ||||||
| Fixed Line Telecommunications | 67 | 73 | 60 | 52 | 55 | |
| Operating Cycle, Industry | ||||||
| Telecommunications | 63 | 68 | 59 | 51 | 55 | |
Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-20), 10-K (filing date: 2017-02-17), 10-K (filing date: 2016-02-18).
1 2019 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 12 + 46 = 58
2 Click competitor name to see calculations.
| Short-term activity ratio | Description | The company |
|---|---|---|
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | AT&T Inc.’s operating cycle deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level. |
Average Payables Payment Period
AT&T Inc., average payables payment period calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | 2.84 | 2.94 | 3.17 | 3.49 | 3.19 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | 129 | 124 | 115 | 105 | 115 | |
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Verizon Communications Inc. | 52 | 48 | 50 | 50 | 44 | |
| Average Payables Payment Period, Sector | ||||||
| Fixed Line Telecommunications | 98 | 93 | 89 | 83 | 84 | |
| Average Payables Payment Period, Industry | ||||||
| Telecommunications | 97 | 95 | 94 | 86 | 91 | |
Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-20), 10-K (filing date: 2017-02-17), 10-K (filing date: 2016-02-18).
1 2019 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 2.84 = 129
2 Click competitor name to see calculations.
| 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. | AT&T Inc.’s number of days of payables outstanding increased from 2017 to 2018 and from 2018 to 2019. |
Cash Conversion Cycle
AT&T Inc., cash conversion cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 12 | 13 | 10 | 10 | 22 | |
| Average receivable collection period | 46 | 57 | 38 | 37 | 41 | |
| Average payables payment period | 129 | 124 | 115 | 105 | 115 | |
| Short-term Activity Ratio | ||||||
| Cash conversion cycle1 | -71 | -54 | -67 | -58 | -52 | |
| Benchmarks | ||||||
| Cash Conversion Cycle, Competitors2 | ||||||
| Verizon Communications Inc. | 27 | 31 | 25 | 10 | 2 | |
| Cash Conversion Cycle, Sector | ||||||
| Fixed Line Telecommunications | -31 | -20 | -29 | -31 | -29 | |
| Cash Conversion Cycle, Industry | ||||||
| Telecommunications | -34 | -27 | -35 | -35 | -36 | |
Based on: 10-K (filing date: 2020-02-20), 10-K (filing date: 2019-02-20), 10-K (filing date: 2018-02-20), 10-K (filing date: 2017-02-17), 10-K (filing date: 2016-02-18).
1 2019 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 12 + 46 – 129 = -71
2 Click competitor name to see calculations.
| 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. | AT&T Inc.’s cash conversion cycle deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level. |