Analysis of Long-term (Investment) 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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- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Solvency Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Analysis of Geographic Areas
- Enterprise Value (EV)
- Enterprise Value to EBITDA (EV/EBITDA)
- Enterprise Value to FCFF (EV/FCFF)
- Price to FCFE (P/FCFE)
- Dividend Discount Model (DDM)
- Aggregate Accruals
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Long-term Activity Ratios (Summary)
Allergan Inc., long-term (investment) activity ratios (quarterly data)
Based on: 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio demonstrates a generally stable and slightly increasing trend over the observed periods. Starting at 6.3 in the first quarter of 2011, the ratio gradually rises, reaching a peak of 7.08 by the last quarter of 2014. This indicates a modest improvement in the efficiency with which the company utilizes its fixed assets to generate sales, especially notable toward the end of the period.
- Total Asset Turnover
- The total asset turnover ratio fluctuates within a narrow range, showing a mild downward trend across the four-year span. It begins at 0.59 in the first quarter of 2011 and slightly increases early on but then consistently decreases from mid-2013, ending at 0.57 in the final quarter of 2014. This suggests a gradual decline in the overall efficiency of asset utilization in generating revenue.
- Equity Turnover
- The equity turnover ratio remains relatively steady throughout the timeframe, with some minor variability. It starts at 1.02 in early 2011, exhibits small oscillations around the 1.0 mark, and then shows a gradual decline after mid-2013, finishing at 0.92 by the end of 2014. This trend indicates a slight reduction in the effectiveness of equity in contributing to sales revenues over the periods analyzed.
Net Fixed Asset Turnover
Allergan Inc., net fixed asset turnover calculation (quarterly data)
| Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||
| Product net sales | |||||||||||||||||||||
| Property, plant and equipment, net | |||||||||||||||||||||
| Long-term Activity Ratio | |||||||||||||||||||||
| Net fixed asset turnover1 | |||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||
| Net Fixed Asset Turnover, Competitors2 | |||||||||||||||||||||
| AbbVie Inc. | |||||||||||||||||||||
| Amgen Inc. | |||||||||||||||||||||
| Bristol-Myers Squibb Co. | |||||||||||||||||||||
| Danaher Corp. | |||||||||||||||||||||
| Eli Lilly & Co. | |||||||||||||||||||||
| Gilead Sciences Inc. | |||||||||||||||||||||
| Johnson & Johnson | |||||||||||||||||||||
| Merck & Co. Inc. | |||||||||||||||||||||
| Pfizer Inc. | |||||||||||||||||||||
| Regeneron Pharmaceuticals Inc. | |||||||||||||||||||||
| Thermo Fisher Scientific Inc. | |||||||||||||||||||||
| Vertex Pharmaceuticals Inc. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q4 2014 Calculation
Net fixed asset turnover
= (Product net salesQ4 2014
+ Product net salesQ3 2014
+ Product net salesQ2 2014
+ Product net salesQ1 2014)
÷ Property, plant and equipment, net
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The analysis of the financial data reveals several notable trends over the examined periods.
- Product Net Sales
- Product net sales exhibit a generally upward trajectory from March 31, 2011, through December 31, 2014. There is consistent growth quarter over quarter, with slight fluctuations in some quarters but an overall increase from approximately 1,252,800 thousand US$ in early 2011 to about 1,889,000 thousand US$ by the end of 2014. This indicates a strong sales performance and expanding revenue base during the period.
- Property, Plant, and Equipment, Net
- The net value of property, plant, and equipment shows a steady increase during the period, rising from 788,500 thousand US$ in March 2011 to 1,006,300 thousand US$ by December 2014. This gradual rise suggests ongoing investment in fixed assets, possibly reflecting capacity expansion or modernization efforts. Growth is relatively consistent without abrupt changes, suggesting planned and sustained capital expenditure.
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio, which measures the efficiency with which the company utilizes its fixed assets to generate sales, remains relatively stable throughout the periods, fluctuating within a narrow range roughly between 6.3 and 7.08. The ratio slightly increases over time, indicating a modest improvement in the efficient use of fixed assets. This improvement coupled with rising sales and asset base reflects positively on operational efficiency and asset management.
In summary, the data indicates steady growth in sales alongside consistent investment in fixed assets. The stable to improving fixed asset turnover ratio suggests that the company is managing its asset base efficiently relative to sales growth. These trends collectively point to favorable operational and financial health during the analyzed timeframe.
Total Asset Turnover
Allergan Inc., total asset turnover calculation (quarterly data)
| Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||
| Product net sales | |||||||||||||||||||||
| Total assets | |||||||||||||||||||||
| Long-term Activity Ratio | |||||||||||||||||||||
| Total asset turnover1 | |||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||
| Total Asset Turnover, Competitors2 | |||||||||||||||||||||
| AbbVie Inc. | |||||||||||||||||||||
| Amgen Inc. | |||||||||||||||||||||
| Bristol-Myers Squibb Co. | |||||||||||||||||||||
| Danaher Corp. | |||||||||||||||||||||
| Eli Lilly & Co. | |||||||||||||||||||||
| Gilead Sciences Inc. | |||||||||||||||||||||
| Johnson & Johnson | |||||||||||||||||||||
| Merck & Co. Inc. | |||||||||||||||||||||
| Pfizer Inc. | |||||||||||||||||||||
| Regeneron Pharmaceuticals Inc. | |||||||||||||||||||||
| Thermo Fisher Scientific Inc. | |||||||||||||||||||||
| Vertex Pharmaceuticals Inc. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q4 2014 Calculation
Total asset turnover
= (Product net salesQ4 2014
+ Product net salesQ3 2014
+ Product net salesQ2 2014
+ Product net salesQ1 2014)
÷ Total assets
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial information reveals several notable trends in the company's performance and asset utilization over the specified periods.
- Product Net Sales
- The product net sales demonstrate a general upward trend throughout the observed timeframe. Starting at approximately 1,252,800 thousand USD in the first quarter of 2011, sales increased with some fluctuations to reach about 1,889,000 thousand USD by the end of 2014. This reflects a significant growth in revenue generation capabilities. Periodic increments are evident each year, with particularly strong increases noted in the second and fourth quarters of multiple years, suggesting possible seasonality or successful product cycles during these periods.
- Total Assets
- Total assets steadily increased over the examined quarters, beginning near 8,370,700 thousand USD in early 2011 and rising to over 12,415,700 thousand USD by the last quarter of 2014. This consistent expansion indicates ongoing investments in asset base, which may be attributed to acquisitions, capital expenditures, or accumulation of working capital. The rise in assets generally aligns with the growth in sales, implying the company's scale and operations have grown in tandem.
- Total Asset Turnover
- The total asset turnover ratio, representing efficiency in asset use to generate sales, shows a mild declining trend. It started at 0.59 in March 2011, peaked at 0.65 in June 2011, and gradually decreased to 0.57 by December 2014. This decline suggests that while sales and assets have both grown, asset growth has outpaced sales growth slightly, resulting in less efficient asset utilization over time. The reduction in asset turnover could imply increasing capital intensity or less effective deployment of resources.
In summary, the company has experienced robust sales growth accompanied by significant expansion in asset base. However, the decreasing asset turnover indicates a relative decline in efficiency in using assets to generate sales revenue. Continuous monitoring of this trend is advisable to ensure that asset investments translate effectively into proportional revenue increases.
Equity Turnover
Allergan Inc., equity turnover calculation (quarterly data)
| Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||
| Product net sales | |||||||||||||||||||||
| Total Allergan, Inc. stockholders’ equity | |||||||||||||||||||||
| Long-term Activity Ratio | |||||||||||||||||||||
| Equity turnover1 | |||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||
| Equity Turnover, Competitors2 | |||||||||||||||||||||
| AbbVie Inc. | |||||||||||||||||||||
| Amgen Inc. | |||||||||||||||||||||
| Bristol-Myers Squibb Co. | |||||||||||||||||||||
| Danaher Corp. | |||||||||||||||||||||
| Eli Lilly & Co. | |||||||||||||||||||||
| Gilead Sciences Inc. | |||||||||||||||||||||
| Johnson & Johnson | |||||||||||||||||||||
| Merck & Co. Inc. | |||||||||||||||||||||
| Pfizer Inc. | |||||||||||||||||||||
| Regeneron Pharmaceuticals Inc. | |||||||||||||||||||||
| Thermo Fisher Scientific Inc. | |||||||||||||||||||||
| Vertex Pharmaceuticals Inc. | |||||||||||||||||||||
Based on: 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q4 2014 Calculation
Equity turnover
= (Product net salesQ4 2014
+ Product net salesQ3 2014
+ Product net salesQ2 2014
+ Product net salesQ1 2014)
÷ Total Allergan, Inc. stockholders’ equity
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The analysis reveals several key trends across product net sales, stockholders’ equity, and equity turnover over the given periods.
- Product Net Sales
- There is a generally increasing trend in product net sales from March 2011 through December 2014. Initial sales in early 2011 start at approximately $1.25 billion and show consistent growth with some quarterly fluctuations, culminating in a high of nearly $1.89 billion by the end of 2014. Seasonal patterns are visible, with sales often peaking in the fourth quarter each year, suggesting cyclical demand or successful year-end commercial activities.
- Total Stockholders’ Equity
- The total stockholders’ equity also demonstrates a steady upward trajectory throughout the period. Starting at roughly $4.87 billion in March 2011, equity rises each quarter with minor variances, reaching around $7.75 billion by the close of 2014. This growth reflects strengthening financial stability and an accumulation of retained earnings or capital increases over the analyzed timeframe.
- Equity Turnover Ratio
- The equity turnover ratio, which measures how efficiently the equity base is utilized to generate sales, exhibits a slight declining trend over the period. While values fluctuate around 1.0 in the early years, indicating that sales generally matched the equity invested, there is a decline to approximately 0.92 by the last quarter of 2014. This suggests a modest decrease in the efficiency with which equity is translated into revenue, despite overall sales growth.
In summary, the company shows strong growth in sales and equity, reflecting positive expansion and financial strengthening. However, the slight decline in equity turnover ratio indicates a marginal reduction in capital efficiency, which may warrant ongoing monitoring to ensure sustained value creation.