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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- Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Profitability Ratios
- Price to FCFE (P/FCFE)
- Capital Asset Pricing Model (CAPM)
- Dividend Discount Model (DDM)
- Net Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Return on Assets (ROA) since 2005
- Debt to Equity since 2005
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Long-term Activity Ratios (Summary)
Devon Energy Corp., long-term (investment) activity ratios
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| 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: 2022-12-31), 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).
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio exhibited fluctuations over the observed period. It commenced at 0.77 in 2018, slightly declined to 0.71 in 2019, then increased to 0.86 in 2020, followed by a modest decrease to 0.80 in 2021. Notably, there was a pronounced improvement in 2022, reaching 1.05. This indicates a growing efficiency in generating sales from fixed assets, particularly evident in the latest year.
- Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)
- The trend for net fixed asset turnover including operating lease and right-of-use assets mirrors that of the conventional net fixed asset turnover ratio, starting at 0.77 in 2018, decreasing to 0.70 in 2019, rising to 0.86 in 2020, then declining slightly to 0.80 in 2021, and finally increasing significantly to 1.05 in 2022. This parallel trend suggests that the incorporation of operating leases and right-of-use assets did not materially alter the turnover pattern.
- Total Asset Turnover
- The total asset turnover ratio showed a declining trend in the early years, dropping from 0.55 in 2018 to 0.45 in 2019. This was followed by marginal recovery to 0.49 in 2020 and a more significant improvement to 0.58 in 2021. The most notable increase occurred in 2022 when the ratio rose sharply to 0.81. Overall, the total asset turnover reflects an improving capacity to utilize total assets to generate revenue, with the strongest performance in the final year observed.
- Equity Turnover
- Equity turnover began at 1.17 in 2018 and declined slightly to 1.07 in 2019. It then experienced a marked increase in 2020, rising to 1.67, followed by a dip to 1.32 in 2021. The ratio increased again in 2022 to a peak of 1.72 over the period. This volatility indicates fluctuations in equity utilization intensity, but with an overall upward trend, particularly notable in 2020 and 2022.
Net Fixed Asset Turnover
Devon Energy Corp., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues | ||||||
| Property and equipment, net, including finance lease right-of-use assets | ||||||
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | ||||||
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Net Fixed Asset Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Net Fixed Asset Turnover, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2022-12-31), 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).
1 2022 Calculation
Net fixed asset turnover = Revenues ÷ Property and equipment, net, including finance lease right-of-use assets
= ÷ =
2 Click competitor name to see calculations.
The financial data reveals several notable trends over the five-year period.
- Revenues
- Revenues experienced a significant decline from 2018 to 2020, dropping from $10,734 million to $4,828 million. This period reflects a contraction of more than 50%, likely indicating challenging market conditions or operational setbacks. However, from 2020 to 2022, revenues showed a strong recovery, increasing sharply to $19,169 million by the end of 2022. This represents a more than fourfold increase from the 2020 trough, suggesting a robust rebound and possible expansion efforts or market improvements during the later years.
- Property and Equipment, Net
- The net value of property and equipment demonstrated a pattern largely aligned with revenues but with some variation. It declined from $13,935 million in 2018 to $5,613 million in 2020, reflecting potential asset disposals, impairments, or capital expenditure reductions during the downturn. From 2020 onwards, the asset base expanded substantially, rising to $18,309 million by 2022. This increase exceeds the prior peak in 2018, indicating significant reinvestment and growth in capital assets during the recovery phase.
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio fluctuated within a moderate range over the years. It decreased slightly from 0.77 in 2018 to 0.71 in 2019, suggesting reduced efficiency in using fixed assets to generate revenues during that period. In 2020, the ratio improved to 0.86, potentially reflecting cost controls or revenue stabilization relative to asset levels. The ratio dipped again to 0.80 in 2021 but showed a notable increase to 1.05 in 2022, indicating enhanced operational efficiency and better utilization of fixed assets in generating sales at the end of the period.
Overall, the data indicates a period of significant contraction followed by a strong recovery in both revenue and asset base. The improved fixed asset turnover ratio in the final year suggests more effective management of capital resources as the company capitalized on market opportunities or operational improvements.
Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
Devon Energy Corp., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues | ||||||
| Property and equipment, net, including finance lease right-of-use assets | ||||||
| Operating lease right-of-use assets | ||||||
| Property and equipment, net, including finance lease right-of-use assets (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 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2022-12-31), 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).
1 2022 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset) = Revenues ÷ Property and equipment, net, including finance lease right-of-use assets (including operating lease, right-of-use asset)
= ÷ =
2 Click competitor name to see calculations.
- Revenues
- Revenues demonstrated significant volatility over the five-year period. There was a sharp decline from $10,734 million in 2018 to $6,220 million in 2019, followed by a further decrease to $4,828 million in 2020. However, revenues rebounded strongly after 2020, increasing to $12,206 million in 2021 and continuing the upward trajectory to $19,169 million in 2022. This pattern indicates a substantial recovery and growth phase after a period of considerable decline.
- Property and equipment, net, including finance lease right-of-use assets
- The net value of property and equipment mirrored the revenue trends to some extent, with a steady decrease from $13,935 million in 2018 to $5,616 million in 2020. This decline might reflect asset disposals, impairments, or reduced capital expenditures during that period. Following the low in 2020, there was a marked increase to $15,243 million in 2021 and a further rise to $18,330 million in 2022. This rebound suggests renewed investment in fixed assets or significant capital expenditures aligning with the rise in revenues.
- Net fixed asset turnover (including operating lease, right-of-use asset)
- The net fixed asset turnover ratio fluctuated throughout the period but generally exhibited an improving trend. Starting at 0.77 in 2018, it declined to 0.70 in 2019, then increased to 0.86 in 2020. After a slight dip to 0.80 in 2021, the ratio rose significantly to 1.05 in 2022, indicating improved efficiency in generating revenue from fixed assets by the end of the period. This increase suggests better utilization of assets or enhanced operational performance in relation to the asset base.
- Overall Analysis
- The data reveals a period of financial stress or contraction during 2019-2020, evidenced by sharp declines in revenue and fixed assets. Recovery commenced in 2021 with both revenues and asset values increasing substantially, continuing into 2022. The rising net fixed asset turnover ratio supports the interpretation of improved asset utilization efficiency. These trends may reflect external market conditions impacting the company followed by strategic adjustments and investment leading to growth and enhanced operational effectiveness.
Total Asset Turnover
Devon Energy Corp., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues | ||||||
| Total assets | ||||||
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | ||||||
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Total Asset Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Total Asset Turnover, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2022-12-31), 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).
1 2022 Calculation
Total asset turnover = Revenues ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
The financial data reveals several notable trends over the five-year period. Revenues exhibited fluctuations, with a significant decline from 10,734 million US dollars in 2018 to a low of 4,828 million US dollars in 2020. Subsequently, revenues recovered strongly, reaching 12,206 million US dollars in 2021 and further increasing to 19,169 million US dollars in 2022. This recovery and growth phase implies either market expansion, increased production, or favorable pricing conditions post-2020.
Total assets followed a similar pattern, decreasing from 19,566 million US dollars in 2018 to 9,912 million US dollars in 2020. After 2020, assets increased sharply, reaching 21,025 million US dollars in 2021 and then rising further to 23,721 million US dollars in 2022. This suggests reinvestment and asset acquisition aligning with the revenue recovery and growth observed in the later years.
The total asset turnover ratio, which measures the efficiency of asset use to generate revenue, declined from 0.55 in 2018 to 0.45 in 2019, followed by a modest increase to 0.49 in 2020. A marked improvement was noted thereafter, with the ratio rising to 0.58 in 2021 and significantly to 0.81 in 2022. This trend indicates an enhanced effectiveness in utilizing assets to generate sales, particularly in 2022, which might reflect operational improvements or better asset management during that year.
- Revenues
- Declined significantly in 2019-2020, followed by a sustained and strong recovery in 2021-2022, ultimately surpassing prior levels.
- Total Assets
- Contracted markedly through 2020, then expanded aggressively, indicating a strategic reversal and growth investment post-2020.
- Total Asset Turnover
- Initial decline through 2019, modest improvement in 2020, then substantial gains in 2021 and 2022, underscoring improved asset efficiency.
Overall, the data portrays a business cycle impacted by a downturn around 2019-2020, succeeded by a robust recovery period. The improvements in total asset turnover highlight increasing operational efficiency in asset utilization that accompanied revenue growth and asset expansion in recent years.
Equity Turnover
Devon Energy Corp., equity turnover calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues | ||||||
| Stockholders’ equity attributable to Devon | ||||||
| Long-term Activity Ratio | ||||||
| Equity turnover1 | ||||||
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Equity Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Equity Turnover, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2022-12-31), 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).
1 2022 Calculation
Equity turnover = Revenues ÷ Stockholders’ equity attributable to Devon
= ÷ =
2 Click competitor name to see calculations.
- Revenues
- The revenue figures experienced significant fluctuations over the examined period. Starting at $10,734 million in 2018, revenues declined sharply to $6,220 million in 2019 and further decreased to $4,828 million in 2020. This downward trend was reversed in subsequent years, with revenues increasing markedly to $12,206 million in 2021 and continuing to rise to $19,169 million by the end of 2022. The revenue trend suggests a recovery and strong growth following the declines in 2019 and 2020.
- Stockholders' equity attributable to Devon
- The stockholders’ equity showed a pattern similar to revenues but with less pronounced recovery. Starting at $9,186 million in 2018, equity declined substantially to $5,802 million in 2019, and then halved again to $2,885 million in 2020. In 2021, equity rebounded strongly to $9,262 million, almost reaching the 2018 level, and then increased further to $11,167 million in 2022. This recovery indicates a restoration of shareholder value after a period of considerable reduction.
- Equity turnover
- Equity turnover, a ratio indicating how efficiently the company utilizes equity to generate revenues, showed variability but an overall increasing trend. The ratio decreased slightly from 1.17 in 2018 to 1.07 in 2019, followed by a strong increase to 1.67 in 2020. It then decreased to 1.32 in 2021 before reaching its highest point at 1.72 in 2022. This suggests that despite fluctuations, the company improved its efficiency in generating revenues from equity, particularly in the later years.