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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- Statement of Comprehensive Income
- Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Profitability Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Enterprise Value (EV)
- Dividend Discount Model (DDM)
- Price to Operating Profit (P/OP) since 2007
- Price to Book Value (P/BV) since 2007
- Price to Sales (P/S) since 2007
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Long-term Activity Ratios (Summary)
Delta Air Lines Inc., long-term (investment) activity ratios
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| 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: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
The financial data exhibit several notable trends in the efficiency metrics over the five-year period ending December 31, 2021.
- Net Fixed Asset Turnover
- This ratio remained relatively stable between 2017 and 2019, fluctuating slightly around the 1.5 mark. However, there was a significant decline in 2020, dropping to 0.64, which signals a sharp decrease in the revenue generated per unit of net fixed assets during that year. A partial recovery occurred in 2021, with the ratio increasing to 1.04 but still below pre-2020 levels.
- Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)
- Including operating leases and right-of-use assets, this ratio followed a declining trend from 2017 through 2019, dropping from 1.55 to 1.27. Like the standard net fixed asset turnover, it experienced a substantial decline in 2020 to 0.53, followed by a moderate rebound to 0.83 in 2021. The downward trend before 2020 and the sharper decline in 2020 suggest increasing capital intensity or reduced asset utilization, exacerbated by the inclusion of lease assets.
- Total Asset Turnover
- This ratio showed a progressive decrease over the entire period, albeit more pronounced in 2020 when it plummeted to 0.24 from 0.73 in 2019. The ratio recovered slightly in 2021 to 0.41, yet it remained well below previous years' figures. This suggests a significant reduction in overall asset efficiency, likely reflecting challenges in generating revenue from total assets amidst operational disruptions.
- Equity Turnover
- The equity turnover ratio demonstrated relatively stable values from 2017 through 2019, fluctuating between approximately 2.97 and 3.25. In 2020, it spiked dramatically to 11.14, indicating a sharp increase in revenue relative to shareholders' equity during that year. This unusual increase may reflect extraordinary financial dynamics or capital structure changes in response to external shocks. In 2021, the ratio decreased to 7.69 but remained elevated compared to pre-2020 levels, suggesting sustained but moderated changes in equity utilization efficiency.
Overall, the data reveal a pronounced impact around the year 2020, with marked declines in asset turnover ratios reflecting decreased operational efficiency or capacity utilization. The equity turnover ratio's atypical surge in the same period points to adjustments in capital structure or equity base that influenced the relationship between revenue and equity.
Net Fixed Asset Turnover
Delta Air Lines Inc., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating revenue | ||||||
| Property and equipment, net of accumulated depreciation and amortization | ||||||
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | ||||||
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| FedEx Corp. | ||||||
| Uber Technologies Inc. | ||||||
| Union Pacific Corp. | ||||||
| United Airlines Holdings Inc. | ||||||
| United Parcel Service Inc. | ||||||
| Net Fixed Asset Turnover, Sector | ||||||
| Transportation | ||||||
| Net Fixed Asset Turnover, Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Net fixed asset turnover = Operating revenue ÷ Property and equipment, net of accumulated depreciation and amortization
= ÷ =
2 Click competitor name to see calculations.
- Operating Revenue
- The operating revenue displayed an overall increasing trend from 2017 through 2019, rising from 41,244 million US dollars in 2017 to 47,007 million US dollars in 2019. A significant decline occurred in 2020, with revenue dropping sharply to 17,095 million US dollars. This was followed by a partial recovery in 2021, reaching 29,899 million US dollars, which remains below the pre-2020 peak levels.
- Property and Equipment, Net of Accumulated Depreciation and Amortization
- This asset category saw a steady increase in value from 26,563 million US dollars in 2017 to 31,310 million US dollars in 2019, indicating ongoing investment or capital expenditure. In 2020, a reduction occurred, bringing the amount down to 26,529 million US dollars, but the figure slightly rebounded to 28,749 million US dollars in 2021.
- Net Fixed Asset Turnover Ratio
- The net fixed asset turnover ratio remained relatively stable from 2017 to 2019, fluctuating modestly around 1.5 to 1.57. This consistency indicates a stable efficiency in using fixed assets to generate revenue during this period. In 2020, the ratio dropped dramatically to 0.64, reflecting a significant decrease in asset utilization efficiency likely due to reduced revenue amid unchanged or less reduced fixed assets. A recovery to 1.04 in 2021 suggests an improvement in asset utilization efficiency, though it remains below the levels observed before 2020.
Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
Delta Air Lines Inc., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating revenue | ||||||
| Property and equipment, net of accumulated depreciation and amortization | ||||||
| Operating lease right-of-use assets | ||||||
| Property and equipment, net of accumulated depreciation and amortization (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 | ||||||
| FedEx Corp. | ||||||
| Uber Technologies Inc. | ||||||
| Union Pacific Corp. | ||||||
| United Airlines Holdings Inc. | ||||||
| United Parcel Service Inc. | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Transportation | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset) = Operating revenue ÷ Property and equipment, net of accumulated depreciation and amortization (including operating lease, right-of-use asset)
= ÷ =
2 Click competitor name to see calculations.
- Operating Revenue
- The operating revenue experienced a consistent increase from 2017 to 2019, rising from $41,244 million to $47,007 million. In 2020, there was a sharp decline to $17,095 million, reflecting a significant downturn. This was followed by a partial recovery in 2021, with revenue increasing to $29,899 million, though still below pre-2020 levels.
- Property and Equipment, Net
- The net value of property and equipment, including operating lease right-of-use assets, showed an overall increasing trend from 2017 to 2019, growing from $26,563 million to $36,937 million. In 2020, a decrease to $32,262 million occurred, followed by a rebound to $35,986 million in 2021. This indicates some asset reduction during the downturn with a subsequent recovery phase.
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio steadily declined from 1.55 in 2017 to 1.27 in 2019, indicating decreasing revenue generation efficiency per unit of asset. In 2020, this ratio dropped significantly to 0.53, corresponding with the sharp revenue decline. Partial recovery occurred in 2021, with the ratio rising to 0.83, though it remained below the levels seen before 2020.
Total Asset Turnover
Delta Air Lines Inc., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating revenue | ||||||
| Total assets | ||||||
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | ||||||
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| FedEx Corp. | ||||||
| Uber Technologies Inc. | ||||||
| Union Pacific Corp. | ||||||
| United Airlines Holdings Inc. | ||||||
| United Parcel Service Inc. | ||||||
| Total Asset Turnover, Sector | ||||||
| Transportation | ||||||
| Total Asset Turnover, Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Total asset turnover = Operating revenue ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
The analysis of the annual data reveals several notable trends and shifts over the five-year period.
- Operating Revenue
- The operating revenue exhibited a steady increase from 2017 through 2019, rising from approximately 41.2 billion US dollars to 47.0 billion US dollars. However, a significant decline occurred in 2020, with revenue falling sharply to about 17.1 billion US dollars, reflecting a considerable contraction. In 2021, there was a recovery in revenue to nearly 29.9 billion US dollars, indicating a partial rebound but still below pre-2020 levels.
- Total Assets
- Total assets showed a consistent upward trajectory throughout the entire period. The asset base grew from around 53.3 billion US dollars in 2017 to roughly 72.5 billion US dollars by the end of 2021. This steady increase suggests ongoing investment or accumulation of resources despite fluctuations in operating revenue.
- Total Asset Turnover Ratio
- The total asset turnover ratio, which measures the efficiency of asset utilization in generating revenue, declined gradually from 0.77 in 2017 to 0.73 in 2019. This trend indicates a slight decrease in operational efficiency. In 2020, there was a sharp drop to 0.24, coinciding with the significant revenue contraction. Although the ratio improved to 0.41 in 2021, it remained well below earlier levels, implying ongoing challenges in asset utilization efficiency.
Overall, the data reflects a period of growth up to 2019, followed by a severe impact in 2020, likely related to external disruptive factors. While some signs of recovery are present in 2021, performance metrics have not yet returned to their pre-disruption status. The continuous increase in total assets amidst declining efficiency and revenue in 2020 and 2021 suggests a potential imbalance between asset growth and operational returns that may require strategic attention.
Equity Turnover
Delta Air Lines Inc., equity turnover calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating revenue | ||||||
| Stockholders’ equity | ||||||
| Long-term Activity Ratio | ||||||
| Equity turnover1 | ||||||
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| FedEx Corp. | ||||||
| Uber Technologies Inc. | ||||||
| Union Pacific Corp. | ||||||
| United Airlines Holdings Inc. | ||||||
| United Parcel Service Inc. | ||||||
| Equity Turnover, Sector | ||||||
| Transportation | ||||||
| Equity Turnover, Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Equity turnover = Operating revenue ÷ Stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
- Operating Revenue
- Operating revenue increased from 41,244 million USD in 2017 to a peak of 47,007 million USD in 2019, demonstrating steady growth over this period. However, a sharp decline occurred in 2020, falling to 17,095 million USD, likely due to external disruptions. In 2021, revenue began to recover, rising to 29,899 million USD but remaining significantly below pre-2020 levels.
- Stockholders’ Equity
- Stockholders’ equity remained relatively stable between 2017 and 2019, fluctuating slightly around 13,600 to 15,300 million USD. In 2020, equity dropped sharply to 1,534 million USD, reflecting a substantial decrease. By 2021, equity partially recovered, increasing to 3,887 million USD, yet it was still markedly lower than the earlier years.
- Equity Turnover Ratio
- The equity turnover ratio showed moderate volatility from 2017 to 2019, fluctuating between 2.97 and 3.25. In 2020, there was a pronounced spike, with the ratio rising dramatically to 11.14, indicating significantly higher revenue generated per unit of equity despite the absolute revenue drop. In 2021, the ratio decreased to 7.69, signaling a reduction from the previous year but still elevated compared to the earlier period.
- Overall Insights
- The data indicate that the company experienced growth in operating revenue and maintained stable equity values up to 2019, followed by a severe impact in 2020, presumably due to external factors affecting the business environment. The recovery in 2021 shows improvement but not a full return to previous conditions. The sharp increase in equity turnover during 2020 suggests an effort to optimize asset utilization amid reduced equity and revenue. The partial recovery in equity turnover in 2021 aligns with the gradual rebound in revenue and equity but reflects ongoing challenges in restoring previous performance levels.