Microsoft Excel LibreOffice Calc

Boeing Co. (BA)

Short-term (Operating) Activity Analysis

Difficulty: Beginner

Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.

Ratios (Summary)

Boeing Co., 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 1.30 1.71 1.87 1.74 1.64
Receivables turnover 26.07 8.88 10.71 11.03 11.74
Payables turnover 6.30 6.23 7.21 7.59 7.19
Working capital turnover 16.21 10.50 7.66 5.39 8.20
Average No. of Days
Average inventory processing period 280 213 195 210 223
Add: Average receivable collection period 14 41 34 33 31
Operating cycle 294 254 229 243 254
Less: Average payables payment period 58 59 51 48 51
Cash conversion cycle 236 195 178 195 203

Based on: 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-12), 10-K (filing date: 2017-02-08), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-12).

Ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Boeing Co.’s inventory turnover deteriorated from 2016 to 2017 and from 2017 to 2018.
Receivables turnover An activity ratio equal to revenue divided by receivables. Boeing Co.’s receivables turnover deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level.
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. Boeing Co.’s payables turnover declined from 2016 to 2017 but then slightly increased from 2017 to 2018.
Working capital turnover An activity ratio calculated as revenue divided by working capital. Boeing Co.’s working capital turnover improved from 2016 to 2017 and from 2017 to 2018.
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. Boeing Co.’s average inventory processing period deteriorated from 2016 to 2017 and from 2017 to 2018.
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnover. Boeing Co.’s average receivable collection period deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level.
Operating cycle Equal to average inventory processing period plus average receivables collection period. Boeing Co.’s operating cycle deteriorated from 2016 to 2017 and from 2017 to 2018.
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. Boeing Co.’s average payables payment period increased from 2016 to 2017 but then slightly declined 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. Boeing Co.’s cash conversion cycle deteriorated from 2016 to 2017 and from 2017 to 2018.

Inventory Turnover

Boeing Co., 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 (USD $ in millions)
Cost of products and services 81,421  75,996  80,731  82,024  76,683 
Inventories 62,567  44,344  43,199  47,257  46,756 
Ratio
Inventory turnover1 1.30 1.71 1.87 1.74 1.64
Benchmarks
Inventory Turnover, Competitors
General Dynamics Corp. 4.93 4.67 7.13 7.53 7.76
Lockheed Martin Corp. 15.51 10.14 9.03 8.25 14.00
Northrop Grumman Corp. 35.63 25.45 22.95 22.16 24.77
Raytheon Co. 25.82 32.11 27.23 27.68 41.78
United Technologies Corp. 4.96 4.45 4.76 4.97 4.81
Inventory Turnover, Sector
Aerospace & Defense 3.01 3.50 3.67 3.44 3.52
Inventory Turnover, Industry
Industrials 4.19 4.43 4.49 4.28 4.56

Based on: 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-12), 10-K (filing date: 2017-02-08), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-12).

2018 Calculations

1 Inventory turnover = Cost of products and services ÷ Inventories
= 81,421 ÷ 62,567 = 1.30

Ratio Description The company
Inventory turnover An activity ratio calculated as cost of goods sold divided by inventory. Boeing Co.’s inventory turnover deteriorated from 2016 to 2017 and from 2017 to 2018.

Receivables Turnover

Boeing Co., 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 (USD $ in millions)
Revenues 101,127  93,392  94,571  96,114  90,762 
Accounts receivable, net 3,879  10,516  8,832  8,713  7,729 
Ratio
Receivables turnover1 26.07 8.88 10.71 11.03 11.74
Benchmarks
Receivables Turnover, Competitors
General Dynamics Corp. 9.63 8.56 8.68 9.13 7.62
Lockheed Martin Corp. 22.00 5.93 5.76 5.72 7.75
Northrop Grumman Corp. 20.78 6.49 7.43 8.28 8.55
Raytheon Co. 16.42 19.15 19.76 19.89 21.99
United Technologies Corp. 4.66 4.75 4.99 5.27 5.75
Receivables Turnover, Sector
Aerospace & Defense 11.47 7.05 7.61 7.93 8.50
Receivables Turnover, Industry
Industrials 7.92 6.39 6.59 6.57 7.01

Based on: 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-12), 10-K (filing date: 2017-02-08), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-12).

2018 Calculations

1 Receivables turnover = Revenues ÷ Accounts receivable, net
= 101,127 ÷ 3,879 = 26.07

Ratio Description The company
Receivables turnover An activity ratio equal to revenue divided by receivables. Boeing Co.’s receivables turnover deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level.

Payables Turnover

Boeing Co., 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 (USD $ in millions)
Cost of products and services 81,421  75,996  80,731  82,024  76,683 
Accounts payable 12,916  12,202  11,190  10,800  10,667 
Ratio
Payables turnover1 6.30 6.23 7.21 7.59 7.19
Benchmarks
Payables Turnover, Competitors
General Dynamics Corp. 9.27 7.73 9.89 12.90 12.14
Lockheed Martin Corp. 19.35 31.02 25.52 20.74 25.70
Northrop Grumman Corp. 10.68 11.95 12.05 13.95 14.08
Raytheon Co. 9.97 12.56 11.81 12.53 13.84
United Technologies Corp. 4.51 4.59 5.54 5.88 6.81
Payables Turnover, Sector
Aerospace & Defense 7.42 7.73 8.72 9.23 9.45
Payables Turnover, Industry
Industrials 6.66 6.77 7.32 7.68 7.41

Based on: 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-12), 10-K (filing date: 2017-02-08), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-12).

2018 Calculations

1 Payables turnover = Cost of products and services ÷ Accounts payable
= 81,421 ÷ 12,916 = 6.30

Ratio Description The company
Payables turnover An activity ratio calculated as cost of goods sold divided by payables. Boeing Co.’s payables turnover declined from 2016 to 2017 but then slightly increased from 2017 to 2018.

Working Capital Turnover

Boeing Co., 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 (USD $ in millions)
Current assets 87,830  65,161  62,488  68,234  67,785 
Less: Current liabilities 81,590  56,269  50,134  50,412  56,717 
Working capital 6,240  8,892  12,354  17,822  11,068 
Revenues 101,127  93,392  94,571  96,114  90,762 
Ratio
Working capital turnover1 16.21 10.50 7.66 5.39 8.20
Benchmarks
Working Capital Turnover, Competitors
General Dynamics Corp. 10.49 5.92 12.05 14.80 8.44
Lockheed Martin Corp. 31.53 10.58 18.41 21.55 37.47
Northrop Grumman Corp. 21.40 2.75 19.99 26.83 10.46
Raytheon Co. 7.03 6.37 5.66 6.31 5.23
United Technologies Corp. 16.08 7.07 8.62 13.72 9.49
Working Capital Turnover, Sector
Aerospace & Defense 15.14 7.02 9.41 9.00 9.48
Working Capital Turnover, Industry
Industrials 7.46 5.08 5.16 5.68 2.66

Based on: 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-12), 10-K (filing date: 2017-02-08), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-12).

2018 Calculations

1 Working capital turnover = Revenues ÷ Working capital
= 101,127 ÷ 6,240 = 16.21

Ratio Description The company
Working capital turnover An activity ratio calculated as revenue divided by working capital. Boeing Co.’s working capital turnover improved from 2016 to 2017 and from 2017 to 2018.

Average Inventory Processing Period

Boeing Co., 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 1.30 1.71 1.87 1.74 1.64
Ratio (no. of days)
Average inventory processing period1 280 213 195 210 223
Benchmarks (no. of days)
Average Inventory Processing Period, Competitors
General Dynamics Corp. 74 78 51 48 47
Lockheed Martin Corp. 24 36 40 44 26
Northrop Grumman Corp. 10 14 16 16 15
Raytheon Co. 14 11 13 13 9
United Technologies Corp. 74 82 77 73 76
Average Inventory Processing Period, Sector
Aerospace & Defense 121 104 99 106 104
Average Inventory Processing Period, Industry
Industrials 87 82 81 85 80

Based on: 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-12), 10-K (filing date: 2017-02-08), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-12).

2018 Calculations

1 Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 1.30 = 280

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. Boeing Co.’s average inventory processing period deteriorated from 2016 to 2017 and from 2017 to 2018.

Average Receivable Collection Period

Boeing Co., 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 26.07 8.88 10.71 11.03 11.74
Ratio (no. of days)
Average receivable collection period1 14 41 34 33 31
Benchmarks (no. of days)
Average Receivable Collection Period, Competitors
General Dynamics Corp. 38 43 42 40 48
Lockheed Martin Corp. 17 62 63 64 47
Northrop Grumman Corp. 18 56 49 44 43
Raytheon Co. 22 19 18 18 17
United Technologies Corp. 78 77 73 69 63
Average Receivable Collection Period, Sector
Aerospace & Defense 32 52 48 46 43
Average Receivable Collection Period, Industry
Industrials 46 57 55 56 52

Based on: 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-12), 10-K (filing date: 2017-02-08), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-12).

2018 Calculations

1 Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 26.07 = 14

Ratio Description The company
Average receivable collection period An activity ratio equal to the number of days in the period divided by receivables turnover. Boeing Co.’s average receivable collection period deteriorated from 2016 to 2017 but then improved from 2017 to 2018 exceeding 2016 level.

Operating Cycle

Boeing Co., operating cycle calculation, comparison to benchmarks

No. of 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 280 213 195 210 223
Average receivable collection period 14 41 34 33 31
Ratio
Operating cycle1 294 254 229 243 254
Benchmarks
Operating Cycle, Competitors
General Dynamics Corp. 112 121 93 88 95
Lockheed Martin Corp. 41 98 103 108 73
Northrop Grumman Corp. 28 70 65 60 58
Raytheon Co. 36 30 31 31 26
United Technologies Corp. 152 159 150 142 139
Operating Cycle, Sector
Aerospace & Defense 153 156 147 152 147
Operating Cycle, Industry
Industrials 133 139 136 141 132

Based on: 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-12), 10-K (filing date: 2017-02-08), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-12).

2018 Calculations

1 Operating cycle = Average inventory processing period + Average receivable collection period
= 280 + 14 = 294

Ratio Description The company
Operating cycle Equal to average inventory processing period plus average receivables collection period. Boeing Co.’s operating cycle deteriorated from 2016 to 2017 and from 2017 to 2018.

Average Payables Payment Period

Boeing Co., 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 6.30 6.23 7.21 7.59 7.19
Ratio (no. of days)
Average payables payment period1 58 59 51 48 51
Benchmarks (no. of days)
Average Payables Payment Period, Competitors
General Dynamics Corp. 39 47 37 28 30
Lockheed Martin Corp. 19 12 14 18 14
Northrop Grumman Corp. 34 31 30 26 26
Raytheon Co. 37 29 31 29 26
United Technologies Corp. 81 80 66 62 54
Average Payables Payment Period, Sector
Aerospace & Defense 49 47 42 40 39
Average Payables Payment Period, Industry
Industrials 55 54 50 48 49

Based on: 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-12), 10-K (filing date: 2017-02-08), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-12).

2018 Calculations

1 Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 6.30 = 58

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. Boeing Co.’s average payables payment period increased from 2016 to 2017 but then slightly declined from 2017 to 2018.

Cash Conversion Cycle

Boeing Co., cash conversion cycle calculation, comparison to benchmarks

No. of 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 280 213 195 210 223
Average receivable collection period 14 41 34 33 31
Average payables payment period 58 59 51 48 51
Ratio
Cash conversion cycle1 236 195 178 195 203
Benchmarks
Cash Conversion Cycle, Competitors
General Dynamics Corp. 73 74 56 60 65
Lockheed Martin Corp. 22 86 89 90 59
Northrop Grumman Corp. -6 39 35 34 32
Raytheon Co. -1 1 0 2 0
United Technologies Corp. 71 79 84 80 85
Cash Conversion Cycle, Sector
Aerospace & Defense 104 109 105 112 108
Cash Conversion Cycle, Industry
Industrials 78 85 86 93 83

Based on: 10-K (filing date: 2019-02-08), 10-K (filing date: 2018-02-12), 10-K (filing date: 2017-02-08), 10-K (filing date: 2016-02-10), 10-K (filing date: 2015-02-12).

2018 Calculations

1 Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 280 + 14 – 58 = 236

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. Boeing Co.’s cash conversion cycle deteriorated from 2016 to 2017 and from 2017 to 2018.