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.
Long-term Activity Ratios (Summary)
CVS Health Corp., long-term (investment) activity ratios
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).
The analysis of investment activity ratios from 2020 through 2024 reveals a consistent improvement in asset utilization efficiency. All measured turnover metrics exhibit a positive trajectory, indicating an enhanced capability to generate revenue from the organization's invested capital base.
- Net Fixed Asset Turnover
- A sustained upward trend is observed in the net fixed asset turnover ratio, which rose from 21.25 in 2020 to 28.53 in 2024. This growth signifies a substantial increase in the efficiency of revenue generation relative to net fixed assets. Similarly, when accounting for operating lease right-of-use assets, the ratio increased from 8.04 to 12.81 over the same period, confirming that efficiency gains are present across both traditional and leased asset bases.
- Total Asset Turnover
- Total asset turnover demonstrates a steady and progressive increase, moving from 1.16 in 2020 to 1.46 in 2024. This trend reflects a broad improvement in the overall efficiency of the entire asset portfolio in driving top-line growth.
- Equity Turnover
- Equity turnover shows a clear positive progression, increasing from 3.86 in 2020 to 4.91 in 2024. A notable acceleration is evident between 2021 and 2022, where the ratio jumped from 3.87 to 4.53, indicating a strengthened ability to generate sales from shareholders' equity.
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Net Fixed Asset Turnover
CVS Health Corp., 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) | ||||||
| Revenues from customers | 370,656) | 356,623) | 321,629) | 290,912) | 267,908) | |
| Property and equipment, net | 12,993) | 13,183) | 12,873) | 12,896) | 12,606) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | 28.53 | 27.05 | 24.98 | 22.56 | 21.25 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Abbott Laboratories | 3.94 | 3.95 | 4.76 | 4.81 | — | |
| Elevance Health Inc. | 37.66 | 39.05 | 36.07 | 34.94 | — | |
| Intuitive Surgical Inc. | 1.80 | 2.01 | 2.62 | 3.04 | — | |
| Medtronic PLC | 5.28 | 5.61 | 5.85 | 5.77 | — | |
| UnitedHealth Group Inc. | 37.44 | 32.10 | 31.81 | 31.81 | — | |
| Net Fixed Asset Turnover, Sector | ||||||
| Health Care Equipment & Services | 17.82 | 17.57 | 17.82 | 17.31 | — | |
| Net Fixed Asset Turnover, Industry | ||||||
| Health Care | 7.29 | 7.22 | 7.88 | 7.74 | — | |
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 = Revenues from customers ÷ Property and equipment, net
= 370,656 ÷ 12,993 = 28.53
2 Click competitor name to see calculations.
Between December 31, 2020, and December 31, 2024, a consistent improvement in the efficiency of fixed asset utilization is observed. The company has achieved substantial revenue growth while maintaining a relatively stagnant investment in property and equipment, leading to a steady increase in the net fixed asset turnover ratio.
- Revenue Performance
- A strong upward trajectory in revenues from customers is evident, rising from 267,908 million US$ in 2020 to 370,656 million US$ by 2024. This represents a sustained expansion of the top line over the five-year period.
- Fixed Asset Stability
- Net property and equipment values remained remarkably stable throughout the analyzed period. The balance fluctuated within a narrow range, starting at 12,606 million US$ in 2020 and ending at 12,993 million US$ in 2024, indicating that revenue growth was not driven by significant capital expenditures in physical infrastructure.
- Net Fixed Asset Turnover Trend
- The net fixed asset turnover ratio demonstrates a linear increase, climbing from 21.25 in 2020 to 28.53 in 2024. This trend signifies that for every dollar invested in net fixed assets, the company generated progressively more revenue each year. The consistent growth of this ratio suggests enhanced operational efficiency and a high capacity to scale revenue without requiring proportional increases in fixed asset investment.
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Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
CVS Health Corp., 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) | ||||||
| Revenues from customers | 370,656) | 356,623) | 321,629) | 290,912) | 267,908) | |
| Property and equipment, net | 12,993) | 13,183) | 12,873) | 12,896) | 12,606) | |
| Operating lease right-of-use assets | 15,944) | 17,252) | 17,872) | 19,122) | 20,729) | |
| Property and equipment, net (including operating lease, right-of-use asset) | 28,937) | 30,435) | 30,745) | 32,018) | 33,335) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover (including operating lease, right-of-use asset)1 | 12.81 | 11.72 | 10.46 | 9.09 | 8.04 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Competitors2 | ||||||
| Abbott Laboratories | 3.58 | 3.56 | 4.25 | 4.26 | — | |
| Elevance Health Inc. | 33.57 | 34.43 | 31.64 | 30.12 | — | |
| Intuitive Surgical Inc. | 1.75 | 1.97 | 2.53 | 2.93 | — | |
| Medtronic PLC | 4.53 | 4.72 | 5.06 | 4.84 | — | |
| UnitedHealth Group Inc. | 25.58 | 22.48 | 21.54 | 21.54 | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Health Care Equipment & Services | 14.73 | 14.40 | 14.39 | 13.89 | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Health Care | 6.46 | 6.36 | 6.90 | 6.75 | — | |
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) = Revenues from customers ÷ Property and equipment, net (including operating lease, right-of-use asset)
= 370,656 ÷ 28,937 = 12.81
2 Click competitor name to see calculations.
A consistent improvement in asset utilization efficiency is observed over the five-year period from 2020 to 2024. This trend is characterized by a simultaneous increase in total revenues and a steady reduction in net property and equipment, including right-of-use assets, leading to a significant rise in the net fixed asset turnover ratio.
- Revenue Growth Trend
- Revenues from customers exhibited uninterrupted growth, rising from 267,908 million US dollars in 2020 to 370,656 million US dollars by 2024. This represents a substantial expansion in the top-line performance over the analyzed period.
- Fixed Asset Reduction
- Net property and equipment, including operating lease right-of-use assets, followed a downward trajectory. The asset base decreased from 33,335 million US dollars in 2020 to 28,937 million US dollars in 2024. This indicates a reduction in the capital tied up in long-term physical and leased assets.
- Net Fixed Asset Turnover Analysis
- The net fixed asset turnover ratio increased steadily each year, moving from 8.04 in 2020 to 12.81 in 2024. This upward trend signifies that the organization is generating increasingly higher levels of revenue for every dollar invested in net fixed assets. The widening gap between growing revenues and a shrinking asset base highlights a marked increase in operational efficiency and capital productivity.
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Total Asset Turnover
CVS Health Corp., 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) | ||||||
| Revenues from customers | 370,656) | 356,623) | 321,629) | 290,912) | 267,908) | |
| Total assets | 253,215) | 249,728) | 228,275) | 232,999) | 230,715) | |
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | 1.46 | 1.43 | 1.41 | 1.25 | 1.16 | |
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Abbott Laboratories | 0.52 | 0.55 | 0.59 | 0.57 | — | |
| Elevance Health Inc. | 1.50 | 1.56 | 1.51 | 1.41 | — | |
| Intuitive Surgical Inc. | 0.45 | 0.46 | 0.48 | 0.42 | — | |
| Medtronic PLC | 0.36 | 0.34 | 0.35 | 0.32 | — | |
| UnitedHealth Group Inc. | 1.32 | 1.34 | 1.31 | 1.34 | — | |
| Total Asset Turnover, Sector | ||||||
| Health Care Equipment & Services | 1.08 | 1.10 | 1.06 | 1.02 | — | |
| Total Asset Turnover, Industry | ||||||
| Health Care | 0.65 | 0.63 | 0.66 | 0.62 | — | |
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 = Revenues from customers ÷ Total assets
= 370,656 ÷ 253,215 = 1.46
2 Click competitor name to see calculations.
The financial performance from 2020 to 2024 exhibits a consistent improvement in asset utilization efficiency. While both revenues and total assets increased over the five-year period, the rate of revenue growth significantly outpaced the expansion of the asset base, resulting in a steady rise in the total asset turnover ratio.
- Revenue Growth Patterns
- A sustained upward trajectory in revenues is observed, increasing from US$ 267,908 million in 2020 to US$ 370,656 million by 2024. This indicates a consistent expansion of the top-line financial performance throughout the analyzed period.
- Asset Base Evolution
- Total assets remained relatively stable between 2020 and 2022, fluctuating slightly around the US$ 230 billion mark. A more pronounced increase occurred starting in 2023, with total assets reaching US$ 253,215 million by the end of 2024.
- Total Asset Turnover Analysis
- The total asset turnover ratio demonstrates a monotonic increase, rising from 1.16 in 2020 to 1.46 in 2024. The most significant gains in efficiency occurred between 2020 and 2022, during which the ratio improved from 1.16 to 1.41. This trend reflects an enhanced capability to generate higher volumes of revenue relative to the investment in assets, signifying improved operational efficiency in the deployment of long-term resources.
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Equity Turnover
CVS Health Corp., 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) | ||||||
| Revenues from customers | 370,656) | 356,623) | 321,629) | 290,912) | 267,908) | |
| Total CVS Health shareholders’ equity | 75,560) | 76,461) | 71,015) | 75,075) | 69,389) | |
| Long-term Activity Ratio | ||||||
| Equity turnover1 | 4.91 | 4.66 | 4.53 | 3.87 | 3.86 | |
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Abbott Laboratories | 0.88 | 1.04 | 1.19 | 1.20 | — | |
| Elevance Health Inc. | 4.24 | 4.33 | 4.29 | 3.80 | — | |
| Intuitive Surgical Inc. | 0.51 | 0.54 | 0.56 | 0.48 | — | |
| Medtronic PLC | 0.64 | 0.61 | 0.60 | 0.59 | — | |
| UnitedHealth Group Inc. | 4.26 | 4.14 | 4.14 | 3.98 | — | |
| Equity Turnover, Sector | ||||||
| Health Care Equipment & Services | 2.63 | 2.66 | 2.61 | 2.42 | — | |
| Equity Turnover, Industry | ||||||
| Health Care | 1.78 | 1.69 | 1.69 | 1.67 | — | |
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 = Revenues from customers ÷ Total CVS Health shareholders’ equity
= 370,656 ÷ 75,560 = 4.91
2 Click competitor name to see calculations.
An analysis of the investment activity between December 31, 2020, and December 31, 2024, reveals a consistent improvement in capital utilization efficiency. The primary driver of this trend is the sustained and significant growth in revenues occurring alongside a relatively stable shareholder equity base.
- Revenue Growth Trends
- Revenues from customers exhibited a continuous upward trajectory over the five-year period, increasing from US$ 267,908 million in 2020 to US$ 370,656 million in 2024. This steady growth indicates a strong expansion of market reach or service volume.
- Equity Base Stability
- Total shareholders' equity remained relatively range-bound, fluctuating between a minimum of US$ 69,389 million in 2020 and a maximum of US$ 76,461 million in 2023, before closing at US$ 75,560 million in 2024. The absence of a proportional increase in equity relative to revenue suggests that growth was not funded by significant new equity injections.
- Equity Turnover Efficiency
- The equity turnover ratio improved steadily, rising from 3.86 in 2020 to 4.91 in 2024. A notable acceleration in efficiency is observed between 2021 and 2022, where the ratio increased from 3.87 to 4.53. This progression signifies a higher capacity to generate sales per unit of shareholder investment, reflecting enhanced operational productivity and an optimized use of the company's equity capital.
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