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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- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Enterprise Value (EV)
- Enterprise Value to EBITDA (EV/EBITDA)
- Present Value of Free Cash Flow to Equity (FCFE)
- Selected Financial Data since 2005
- Net Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Price to Earnings (P/E) since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
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Long-term Activity Ratios (Summary)
Kimberly-Clark Corp., long-term (investment) activity ratios
| Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | ||
|---|---|---|---|---|---|---|
| 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: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31).
The analysis of the provided financial ratios over the five-year period reveals several notable trends in asset utilization and turnover.
- Net fixed asset turnover
- This ratio exhibited minor fluctuations, starting at 2.54 in 2016, slightly declining to 2.46 in 2017, rising again to 2.58 in 2018, before gradually decreasing to 2.48 in 2019 and 2.38 in 2020. This pattern suggests a relatively stable but slightly weakening efficiency in generating sales from fixed assets over the period.
- Net fixed asset turnover (including operating lease, right-of-use asset)
- This adjusted turnover ratio closely mirrors the standard net fixed asset turnover for the initial years but shows a more pronounced decline from 2.58 in 2018 to 2.35 in 2019, and further to 2.23 in 2020. This indicates that when considering the right-of-use assets from operating leases, asset efficiency diminished more evidently in the latter years.
- Total asset turnover
- The total asset turnover ratio follows a downward trajectory, beginning at 1.25 in 2016, decreasing slightly to 1.21 in 2017, rising again to 1.27 in 2018, before declining to 1.21 in 2019 and reaching a low of 1.09 in 2020. This decline points to a reduced overall efficiency in using all assets to generate revenue, especially notable in 2020.
- Equity turnover
- Data for equity turnover is largely incomplete, with only two values available: 29.03 in 2017 and 30.58 in 2020. Despite the limited data, a slight increase is observed, indicating a marginal improvement in revenue generated per unit of equity during this interval.
In summary, the company's asset utilization ratios demonstrate relative stability early in the period, followed by a gradual decline, particularly in 2019 and 2020. The inclusion of operating lease assets highlights a more significant reduction in fixed asset efficiency. Total asset turnover similarly weakens toward the end of the period, reflecting reduced operational efficiency in asset use. Sparse data on equity turnover suggests a modest improvement, but the lack of consistent data prevents a definitive conclusion on equity efficiency trends.
Net Fixed Asset Turnover
Kimberly-Clark Corp., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | ||||||
| Property, plant and equipment, net | ||||||
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | ||||||
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Procter & Gamble Co. | ||||||
| Net Fixed Asset Turnover, Industry | ||||||
| Consumer Staples | ||||||
Based on: 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), 10-K (reporting date: 2016-12-31).
1 2020 Calculation
Net fixed asset turnover = Net sales ÷ Property, plant and equipment, net
= ÷ =
2 Click competitor name to see calculations.
The financial data reveals several key trends over the five-year period from 2016 to 2020. Net sales showed a gradual increase overall, starting at 18,202 million US dollars in 2016 and rising to 19,140 million US dollars in 2020. The sales values fluctuated slightly between years but exhibited a steady upward trajectory by the end of the period.
In terms of property, plant, and equipment (net), the values demonstrate a general growth pattern, increasing from 7,169 million US dollars in 2016 to 8,042 million US dollars in 2020. There was a slight dip in 2018 followed by renewed increases in 2019 and 2020, indicating ongoing investment in fixed assets.
The net fixed asset turnover ratio, which measures efficiency in generating sales from fixed assets, showed a fluctuating but slightly declining trend over the period. Starting at 2.54 in 2016, the ratio decreased to 2.38 by 2020, with minor variations in the intermediate years. This suggests a gradual reduction in the efficiency with which the company utilized its fixed assets to generate sales revenue.
- Net Sales
- Overall growth from 18,202 to 19,140 million US dollars, reflecting steady revenue improvement.
- Property, Plant, and Equipment, Net
- Increasing investment in fixed assets, rising from 7,169 to 8,042 million US dollars over five years, with a slight dip in 2018.
- Net Fixed Asset Turnover
- Declining trend from 2.54 to 2.38, indicating decreasing efficiency in generating sales from fixed assets.
Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
Kimberly-Clark Corp., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | ||||||
| Property, plant and equipment, net | ||||||
| Operating lease assets (classified in Other assets) | ||||||
| Property, plant and equipment, net (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 | ||||||
| Procter & Gamble Co. | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Consumer Staples | ||||||
Based on: 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), 10-K (reporting date: 2016-12-31).
1 2020 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset) = Net sales ÷ Property, plant and equipment, net (including operating lease, right-of-use asset)
= ÷ =
2 Click competitor name to see calculations.
The analyzed financial data reveals several noteworthy trends over the five-year period ending December 31, 2020.
- Net Sales
- The net sales demonstrate a gradual upward trend, increasing from US$18,202 million in 2016 to US$19,140 million in 2020. The growth is steady but modest, indicating stable revenue generation with a slight acceleration in 2020 compared to previous years.
- Property, Plant, and Equipment, Net
- The net value of property, plant, and equipment, including operating lease right-of-use assets, shows an overall increase from US$7,169 million in 2016 to US$8,582 million in 2020. There was a slight decline from 2017 to 2018, but a recovery and consistent growth followed in 2019 and 2020. This pattern suggests ongoing investment in fixed assets after a brief contraction period.
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio, which measures efficiency in using fixed assets to generate sales, decreased over the period. It moved from 2.54 in 2016 to 2.23 in 2020, indicating a declining efficiency. The ratio showed minor fluctuation, rising to 2.58 in 2018 but then continuously falling through 2019 and 2020. This suggests that asset growth has outpaced sales growth, resulting in lower turnover efficiency.
In summary, while sales exhibited steady growth, the investment in fixed assets increased at a faster rate, causing a decline in the net fixed asset turnover ratio. This reflects a trend of expanding asset base that has not yet been fully matched by proportional sales increases, potentially signaling future capacity expansion or changes in asset utilization.
Total Asset Turnover
Kimberly-Clark Corp., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | ||||||
| Total assets | ||||||
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | ||||||
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Procter & Gamble Co. | ||||||
| Total Asset Turnover, Industry | ||||||
| Consumer Staples | ||||||
Based on: 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), 10-K (reporting date: 2016-12-31).
1 2020 Calculation
Total asset turnover = Net sales ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
The financial data over the five-year period from 2016 to 2020 reveals several notable trends regarding sales, asset levels, and asset utilization efficiency.
- Net Sales
- Net sales showed a relatively stable and modest upward trend over the period. Starting at $18,202 million in 2016, sales increased slightly each year, reaching $19,140 million by 2020. This represents a cumulative growth of approximately 5.1%, indicating steady revenue generation without significant volatility.
- Total Assets
- Total assets exhibited more variability and an overall increasing trend. Beginning at $14,602 million in 2016, total assets grew moderately to $15,151 million in 2017 before declining slightly to $14,518 million in 2018. Subsequently, assets increased again, reaching $15,283 million in 2019 and substantially rising to $17,523 million by the end of 2020. The final figure marks a notable increase of about 20% from 2016, suggesting investments or acquisitions that expanded the asset base.
- Total Asset Turnover
- Total asset turnover, which measures sales generated per dollar of assets, declined over the period. Starting at 1.25 in 2016, the ratio dipped to 1.21 in 2017, rose slightly to 1.27 in 2018, then decreased again to 1.21 in 2019, and further dropped to a low of 1.09 in 2020. This downward trend indicates decreasing efficiency in asset utilization, as the company generated less sales revenue relative to its asset base over time, particularly in 2020.
Overall, while net sales experienced gradual growth and total assets expanded significantly by 2020, the declining asset turnover ratio suggests that the company's increased asset investments did not proportionally translate into higher sales efficiency during the analyzed period.
Equity Turnover
Kimberly-Clark Corp., equity turnover calculation, comparison to benchmarks
| Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | ||||||
| Total Kimberly-Clark Corporation stockholders’ equity | ||||||
| Long-term Activity Ratio | ||||||
| Equity turnover1 | ||||||
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Procter & Gamble Co. | ||||||
| Equity Turnover, Industry | ||||||
| Consumer Staples | ||||||
Based on: 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), 10-K (reporting date: 2016-12-31).
1 2020 Calculation
Equity turnover = Net sales ÷ Total Kimberly-Clark Corporation stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
The financial data reveals several key trends and patterns over the five-year period ending in 2020.
- Net Sales
- The net sales figures remained relatively stable from 2016 through 2019, starting at 18,202 million US dollars in 2016 and hovering around 18,450 to 18,486 million US dollars during the subsequent years. There was a noticeable increase in net sales in 2020, with the figure rising to 19,140 million US dollars. This indicates a modest growth in revenue during 2020 after several years of limited variation.
- Total Stockholders' Equity
- The total stockholders’ equity showed significant volatility during the period. In 2016, the equity was negative at -102 million US dollars, and it worsened considerably in 2017, dropping further to -287 million. However, there was a strong recovery in 2019, with the equity rebounding to -33 million, and this positive trend culminated in a substantial turnaround by 2020, reaching a positive equity level of 626 million US dollars. This pattern suggests challenges faced in earlier years, followed by corrective measures or improved financial performance leading to restored equity strength by 2020.
- Equity Turnover Ratio
- The equity turnover ratio, which measures net sales relative to equity, was reported only for two years. In 2017, the ratio was 29.03, and by 2020, it had slightly increased to 30.58. These high turnover ratios typically indicate efficient use of equity to generate sales. The lack of data for the other years restricts a full trend analysis, but the available data points reflect consistent or slightly improved equity utilization over time.