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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- Income Statement
- Statement of Comprehensive Income
- Common-Size Income Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Reportable Segments
- Enterprise Value to FCFF (EV/FCFF)
- Selected Financial Data since 2005
- Net Profit Margin since 2005
- Debt to Equity since 2005
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Long-term Activity Ratios (Summary)
Abbott Laboratories, long-term (investment) activity ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| 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: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio increased significantly from 3.83 in 2020 to a peak of 4.81 in 2021, indicating a more efficient use of fixed assets during that year. It remained relatively stable in 2022 at 4.76 but then declined to 3.95 in 2023 and slightly further to 3.94 in 2024. This trend suggests that after a period of improvement, asset utilization efficiency has diminished somewhat over the last two years.
- Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)
- When including right-of-use assets from operating leases, the turnover ratio follows a similar trajectory to the net fixed asset turnover, increasing from 3.42 in 2020 to 4.26 in 2021 and maintaining a similar level of 4.25 in 2022. However, the ratio declined to 3.56 in 2023 and remained nearly steady at 3.58 in 2024. This indicates that leased assets contribute meaningfully to the total fixed asset base but that overall efficiency gains seen in 2021 and 2022 have tapered off in subsequent years.
- Total Asset Turnover
- Total asset turnover improved gradually from 0.48 in 2020 to 0.59 in 2022, suggesting better overall asset utilization in generating revenues during this period. However, it slightly decreased to 0.55 in 2023 and further to 0.52 in 2024, hinting at a modest decline in the company's ability to generate sales from its entire asset base in the most recent years.
- Equity Turnover
- The equity turnover ratio rose from 1.06 in 2020 to 1.20 in 2021, remaining stable at 1.19 in 2022. However, it dropped to 1.04 in 2023 and declined more sharply to 0.88 in 2024. The downward trend in equity turnover over the last two years suggests reduced effectiveness in utilizing shareholders' equity to generate revenue, which may warrant further investigation into capital structure or profitability changes.
Net Fixed Asset Turnover
Abbott Laboratories, net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | ||||||
| Net property and equipment | ||||||
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | ||||||
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| CVS Health Corp. | ||||||
| Elevance Health Inc. | ||||||
| Intuitive Surgical Inc. | ||||||
| Medtronic PLC | ||||||
| UnitedHealth Group Inc. | ||||||
| Net Fixed Asset Turnover, Sector | ||||||
| Health Care Equipment & Services | ||||||
| Net Fixed Asset Turnover, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Net fixed asset turnover = Net sales ÷ Net property and equipment
= ÷ =
2 Click competitor name to see calculations.
- Net Sales
- Net sales showed a general upward trend from 2020 to 2024. There was a significant increase from 34,608 million US dollars in 2020 to a peak of 43,653 million in 2022. However, sales declined in 2023 to 40,109 million before partially recovering to 41,950 million in 2024. This pattern indicates some volatility in revenue generation after the initial growth phase.
- Net Property and Equipment
- The value of net property and equipment remained relatively stable from 2020 through 2022, fluctuating slightly around the 9,000 million US dollar mark. From 2023 onward, there was a noticeable increase, reaching 10,658 million US dollars by 2024. This upward movement suggests active investment or acquisitions in fixed assets in the later years.
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio increased markedly from 3.83 in 2020 to a high of 4.81 in 2021, indicating improved efficiency in using fixed assets to generate sales. It held steady at 4.76 in 2022 before declining to approximately 3.95 in 2023 and 3.94 in 2024. The decline corresponds with the increase in net property and equipment values and the decreased net sales in 2023, reflecting less efficient use of fixed assets during that period.
Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
Abbott Laboratories, net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | ||||||
| Net property and equipment | ||||||
| Operating lease, ROU asset (included in Deferred income taxes and other assets) | ||||||
| Net property and equipment (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 | ||||||
| CVS Health Corp. | ||||||
| Elevance Health Inc. | ||||||
| Intuitive Surgical Inc. | ||||||
| Medtronic PLC | ||||||
| UnitedHealth Group Inc. | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Health Care Equipment & Services | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset) = Net sales ÷ Net property and equipment (including operating lease, right-of-use asset)
= ÷ =
2 Click competitor name to see calculations.
- Net Sales
- Net sales exhibited a growth trend from 2020 to 2022, increasing from 34,608 million US dollars to 43,653 million US dollars. However, there was a decline in 2023 to 40,109 million US dollars, followed by a partial recovery in 2024, reaching 41,950 million US dollars. Overall, net sales experienced fluctuations with a notable peak in 2022 before a decrease and slight rebound.
- Net Property and Equipment (including operating lease, right-of-use asset)
- This asset category showed a steady upward trend over the analyzed period. It increased gradually from 10,130 million US dollars in 2020 to 11,733 million US dollars in 2024, indicating ongoing investment or accumulation in property and equipment assets during these years.
- Net Fixed Asset Turnover (including operating lease, right-of-use asset)
- The net fixed asset turnover ratio increased sharply from 3.42 in 2020 to 4.26 in 2021, remaining relatively stable through 2022 at 4.25. However, it experienced a significant decline in 2023 to 3.56 and stabilized at a similar level of 3.58 in 2024. This suggests a reduction in asset utilization efficiency after 2022, despite continued growth in net property and equipment.
Total Asset Turnover
Abbott Laboratories, total asset turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | ||||||
| Total assets | ||||||
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | ||||||
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| CVS Health Corp. | ||||||
| Elevance Health Inc. | ||||||
| Intuitive Surgical Inc. | ||||||
| Medtronic PLC | ||||||
| UnitedHealth Group Inc. | ||||||
| Total Asset Turnover, Sector | ||||||
| Health Care Equipment & Services | ||||||
| Total Asset Turnover, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Total asset turnover = Net sales ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
The financial data demonstrates notable trends in sales, asset levels, and asset utilization over the five-year period.
- Net Sales
- Net sales exhibited a strong upward trajectory from 2020 to 2022, increasing from 34,608 million US dollars in 2020 to 43,653 million US dollars in 2022. However, a decline occurred in 2023 with sales falling to 40,109 million US dollars, followed by a partial recovery in 2024 reaching 41,950 million US dollars. Despite this rebound, sales did not return to the peak levels recorded in 2022.
- Total Assets
- Total assets showed a generally stable trend from 2020 through 2023, fluctuating slightly but staying within the range of approximately 72,000 to 75,000 million US dollars. In 2024, total assets experienced a significant increase, rising to 81,414 million US dollars, representing the highest value during the period under review.
- Total Asset Turnover
- The total asset turnover ratio, which measures the efficiency in using assets to generate sales, improved steadily from 0.48 in 2020 to 0.59 in 2022. This indicates increasingly efficient utilization of assets through this period. However, following this peak, the ratio declined to 0.55 in 2023 and further decreased to 0.52 in 2024, aligning with the observed growth in assets in 2024 and the partial recovery of sales.
Overall, the data suggest that while sales grew substantially until 2022, they faced headwinds afterward, resulting in a dip before partially recovering. Asset levels remained relatively stable until a notable increase in 2024, which appears to have affected the efficiency of asset use, as reflected in the declining turnover ratio in the last two years. This pattern may indicate increased investment or asset accumulation not yet fully translated into proportional sales growth.
Equity Turnover
Abbott Laboratories, equity turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | ||||||
| Total Abbott shareholders’ investment | ||||||
| Long-term Activity Ratio | ||||||
| Equity turnover1 | ||||||
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| CVS Health Corp. | ||||||
| Elevance Health Inc. | ||||||
| Intuitive Surgical Inc. | ||||||
| Medtronic PLC | ||||||
| UnitedHealth Group Inc. | ||||||
| Equity Turnover, Sector | ||||||
| Health Care Equipment & Services | ||||||
| Equity Turnover, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Equity turnover = Net sales ÷ Total Abbott shareholders’ investment
= ÷ =
2 Click competitor name to see calculations.
The financial data over the period from 2020 to 2024 reveals several notable trends and shifts in key metrics.
- Net Sales
- Net sales increased significantly from 34,608 million US dollars in 2020 to a peak of 43,653 million US dollars in 2022. Following this peak, there was a decline to 40,109 million US dollars in 2023, with a slight recovery to 41,950 million US dollars projected for 2024. Overall, the trend shows strong growth from 2020 to 2022, followed by a moderate contraction and a partial rebound.
- Total Abbott shareholders’ investment
- This metric exhibited consistent growth throughout the period. It rose from 32,784 million US dollars in 2020 to 38,603 million US dollars in 2023, then sharply increased to an estimated 47,664 million US dollars in 2024. The data suggests a steady accumulation of shareholders’ equity, with an especially notable increase in the last year under review.
- Equity Turnover Ratio
- The equity turnover ratio, which indicates revenue generated per unit of shareholders’ equity, initially rose from 1.06 in 2020 to a peak of 1.20 in 2021. It remained relatively stable at 1.19 in 2022 before declining to 1.04 in 2023 and further to 0.88 in 2024. This declining trend in the equity turnover ratio from 2022 onward may indicate decreasing efficiency in using shareholders’ equity to generate sales, despite the increase in net sales during 2024.
In summary, the period under review shows strong growth in net sales and shareholders’ investment initially, followed by a recent decline and recovery in sales alongside a robust increase in shareholders’ equity. The declining equity turnover ratio in recent years suggests a reduced rate of revenue generation relative to the growing equity base.