Analysis of Long-term (Investment) Activity Ratios
Quarterly Data
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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- Common-Size Income Statement
- Common-Size Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Liquidity Ratios
- Analysis of Solvency Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Total Asset Turnover since 2005
- Price to Sales (P/S) since 2005
- Analysis of Debt
- Aggregate Accruals
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Long-term Activity Ratios (Summary)
McKesson Corp., long-term (investment) activity ratios (quarterly data)
Based on: 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-K (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-K (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-K (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-K (reporting date: 2013-03-31), 10-Q (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-K (reporting date: 2012-03-31), 10-Q (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30).
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio exhibited a fluctuating trend over the periods analyzed. Initially, it remained relatively stable around 116 from mid-2011 to early 2012. Subsequently, there was a notable decline beginning mid-2012, reaching a low point of approximately 61.93 by the first quarter of 2014. Following this trough, the ratio demonstrated a gradual recovery trend, improving steadily through 2014 and 2015 to reach the mid-80s range. However, by mid-2016, the ratio showed a slight decrease again. This pattern suggests fluctuating efficiency in generating revenue from fixed assets, with a significant dip and partial rebound over the observed time frame.
- Total Asset Turnover
- The total asset turnover ratio showed moderate variability during the period under review. Starting near 3.7, the ratio stayed fairly consistent with minor oscillations until the end of 2013. At this point, a discernible decline occurred, bottoming out at approximately 2.66 during the first quarter of 2014, which coincides with the nadir observed in fixed asset turnover. Following this, a recovery trend was evident, with the ratio rising gradually to above 3.3 by late 2016. This indicates a recovery in the company's efficiency in utilizing its total assets to generate sales, particularly after the significant downturn around early 2014.
- Equity Turnover
- The equity turnover ratio maintained relatively high values throughout the periods analyzed, ranging mostly between 15 and 22. There was an initial slight decline from mid-2011 through late 2012, followed by a phase of increasing efficiency. Notably, from early 2014 onward, the ratio demonstrated a strong upward trend, peaking around 22.38 in the first quarter of 2015. Post-peak, the ratio stabilized slightly, maintaining elevated levels in the range of approximately 20 to 21.4 through to late 2016. This pattern implies improved efficiency in utilizing shareholders’ equity to generate revenue during the latter years of the period.
Net Fixed Asset Turnover
McKesson Corp., net fixed asset turnover calculation (quarterly data)
| Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||
| Property, plant and equipment, net | |||||||||||||||||||||||||||||
| Long-term Activity Ratio | |||||||||||||||||||||||||||||
| Net fixed asset turnover1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Net Fixed Asset Turnover, Competitors2 | |||||||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-K (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-K (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-K (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-K (reporting date: 2013-03-31), 10-Q (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-K (reporting date: 2012-03-31), 10-Q (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30).
1 Q2 2017 Calculation
Net fixed asset turnover
= (RevenuesQ2 2017
+ RevenuesQ1 2017
+ RevenuesQ4 2016
+ RevenuesQ3 2016)
÷ Property, plant and equipment, net
= ( + + + )
÷ =
2 Click competitor name to see calculations.
- Revenues
- Revenues exhibit a general upward trend over the observed quarterly periods. Starting at approximately 29,980 million US dollars in mid-2011, revenues increased steadily with minor fluctuations, reaching a peak of about 49,957 million US dollars by late 2016. Some quarters show slight declines, such as early 2016, but overall, the trajectory is positive, indicating sustained revenue growth over the five-year span.
- Property, Plant and Equipment, Net
- The net value of property, plant, and equipment shows moderate growth initially, rising from 988 million US dollars in mid-2011 to around 1,348 million by late 2013. A significant increase occurs in early 2014, with values jumping to over 2,200 million US dollars and fluctuating slightly around this higher level through the end of 2016. This suggests substantial capital investment or asset revaluation starting in early 2014, followed by relative stability with minor variations.
- Net Fixed Asset Turnover Ratio
- The net fixed asset turnover ratio, which measures the efficiency in utilizing fixed assets to generate revenue, demonstrates a declining trend from mid-2011 through early 2014. Initially high, around 116, the ratio decreases steadily to about 61.93 in the first quarter of 2014, indicating less efficient utilization of fixed assets during that period. Afterward, the ratio gradually improves, climbing back to the high 80s by late 2015, though it exhibits some volatility through 2016, with values generally staying below initial levels. This pattern suggests that the substantial increase in fixed assets after early 2014 initially outpaced revenue growth, thereby reducing asset turnover efficiency, but operational adjustments or revenue increases modestly restored efficiency over time.
- Summary of Observations
- Overall, the company experienced revenue growth over the reported periods, supported by increased investment in fixed assets starting in early 2014. However, the expanded asset base initially led to reduced asset turnover efficiency, suggesting a lag in leveraging new assets for revenue generation. Subsequent quarters indicate improvement in asset turnover ratios, reflecting a gradual realignment of asset utilization with revenue performance. The data point to strategic asset growth accompanied by operational adjustments aimed at enhancing efficiency and sustaining revenue expansion.
Total Asset Turnover
McKesson Corp., total asset turnover calculation (quarterly data)
| Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||
| Total assets | |||||||||||||||||||||||||||||
| Long-term Activity Ratio | |||||||||||||||||||||||||||||
| Total asset turnover1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Total Asset Turnover, Competitors2 | |||||||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-K (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-K (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-K (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-K (reporting date: 2013-03-31), 10-Q (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-K (reporting date: 2012-03-31), 10-Q (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30).
1 Q2 2017 Calculation
Total asset turnover
= (RevenuesQ2 2017
+ RevenuesQ1 2017
+ RevenuesQ4 2016
+ RevenuesQ3 2016)
÷ Total assets
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The company’s revenues demonstrate a generally upward trend over the observed period. Starting from approximately 29,980 million USD, revenues experience fluctuations but show substantial growth, reaching nearly 49,957 million USD by the last recorded quarter. Notable acceleration in revenue growth is seen particularly from late 2013 onward, with a peak near 48,761 million USD in late 2015 followed by a slight dip and recovery toward 2016.
Total assets register a meaningful increase throughout the time frame, moving from roughly 31,017 million USD initially to about 58,315 million USD by the final quarter. There is a distinct jump in asset value between early 2014 and mid-2014, where assets rise sharply from the mid-30,000s to over 51,000 million USD. Subsequent quarters maintain this higher asset base with gradual incremental increases.
The total asset turnover ratio, used as an efficiency indicator of how effectively the company utilizes its assets to generate revenue, shows initial values around 3.7 to 3.9 in the early quarters. However, a marked decrease occurs in early 2014, dropping sharply to around 2.66. Following this decline, the ratio recovers gradually over subsequent periods, stabilizing near 3.3 by 2016. This pattern suggests a temporary reduction in asset utilization efficiency coinciding with the large asset base increase, followed by gradual improvement.
- Revenue Trend
- Consistent growth with fluctuations, accelerating notably from late 2013 to 2016, indicating expanding business operations or market presence.
- Total Assets Movement
- Significant growth overall, with a major asset base expansion during early 2014, supporting larger scale operations or acquisitions.
- Total Asset Turnover Ratio
- Initial stability followed by a decline aligned with asset base increase, then gradual recovery, reflecting adjustment phase in asset utilization efficiency.
Equity Turnover
McKesson Corp., equity turnover calculation (quarterly data)
| Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||
| Total McKesson Corporation stockholders’ equity | |||||||||||||||||||||||||||||
| Long-term Activity Ratio | |||||||||||||||||||||||||||||
| Equity turnover1 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Equity Turnover, Competitors2 | |||||||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-K (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-K (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-K (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-K (reporting date: 2013-03-31), 10-Q (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-K (reporting date: 2012-03-31), 10-Q (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30).
1 Q2 2017 Calculation
Equity turnover
= (RevenuesQ2 2017
+ RevenuesQ1 2017
+ RevenuesQ4 2016
+ RevenuesQ3 2016)
÷ Total McKesson Corporation stockholders’ equity
= ( + + + )
÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial performance reveals important patterns in key metrics over the examined periods.
- Revenues
- The revenue pattern shows a general upward trend with notable fluctuations. Starting from approximately $29.98 billion in the second quarter of 2011, revenues demonstrated steady growth through 2013 and 2014, peaking at $46.48 billion in the fourth quarter of 2014. After this peak, the revenues experienced some volatility but maintained elevated levels compared to the earlier years, closing near $49.96 billion by the third quarter of 2016. This growth trajectory indicates an overall expansion in business activities and sales volume across the period, with occasional quarterly declines likely due to seasonality or market conditions.
- Total Stockholders’ Equity
- Stockholders' equity displays moderate growth with intermittent fluctuations. The equity base started at approximately $6.9 billion in mid-2011, gradually increasing to around $9.0 billion by the second quarter of 2014. Post-2014, equity levels exhibited some volatility with small decreases and recoveries but generally stabilized just below or around $9.4 billion by late 2016. The fluctuating equity values could be influenced by share buybacks, dividend payments, or retained earnings variations, reflecting changes in the company’s capital structure and profitability retention strategies.
- Equity Turnover Ratio
- The equity turnover ratio, which measures revenue generated per dollar of equity, showed significant variability and an improving efficiency trend over the observed intervals. Initially, the ratio hovered around 16 to 17 times in the earlier years but experienced a noticeable increase between late 2014 and 2015, reaching a peak of 22.38 in the first quarter of 2015. Despite some declines afterward, it maintained a higher level than early periods, averaging around 20 to 21 times by 2016. This indicates an enhanced ability to utilize shareholder equity to generate revenues, potentially reflecting improved operational efficiency or leverage.
In summary, the financial data illustrates sustained revenue growth, a gradually expanding equity base with some volatility, and an increasing efficiency in the use of equity to generate revenues. These trends suggest positive operational performance with attention required on managing equity fluctuations and maintaining the efficiency gains observed in recent years.