Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.

Short-term Activity Ratios (Summary)
Inventory Turnover
Receivables Turnover
Payables Turnover
Working Capital Turnover
Average Inventory Processing Period
Average Receivable Collection Period
Operating Cycle
Average Payables Payment Period
Cash Conversion Cycle

Merck & Co. Inc., short-term (operating) activity ratios (quarterly data)

		Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020		Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019		Dec 31, 2018	Sep 30, 2018	Jun 30, 2018	Mar 31, 2018		Dec 31, 2017	Sep 30, 2017	Jun 30, 2017	Mar 31, 2017		Dec 31, 2016	Sep 30, 2016	Jun 30, 2016	Mar 31, 2016
	Turnover Ratios
	Inventory turnover
	Receivables turnover
	Payables turnover
	Working capital turnover
	Average No. Days
	Average inventory processing period
	Add: Average receivable collection period
	Operating cycle
	Less: Average payables payment period
	Cash conversion cycle

Short-term activity ratio	Description	The company
Inventory turnover	An activity ratio calculated as cost of goods sold divided by inventory.	Merck & Co. Inc.’s inventory turnover ratio deteriorated from Q2 2020 to Q3 2020 but then improved from Q3 2020 to Q4 2020 exceeding Q2 2020 level.
Receivables turnover	An activity ratio equal to revenue divided by receivables.	Merck & Co. Inc.’s receivables turnover ratio deteriorated from Q2 2020 to Q3 2020 but then improved from Q3 2020 to Q4 2020 not reaching Q2 2020 level.
Payables turnover	An activity ratio calculated as cost of goods sold divided by payables.	Merck & Co. Inc.’s payables turnover ratio decreased from Q2 2020 to Q3 2020 and from Q3 2020 to Q4 2020.
Working capital turnover	An activity ratio calculated as revenue divided by working capital.	Merck & Co. Inc.’s working capital turnover ratio improved from Q2 2020 to Q3 2020 and from Q3 2020 to Q4 2020.

Short-term activity ratio	Description	The company
Average inventory processing period	An activity ratio equal to the number of days in the period divided by inventory turnover over the period.	Merck & Co. Inc.’s number of days of inventory outstanding deteriorated from Q2 2020 to Q3 2020 but then improved from Q3 2020 to Q4 2020 exceeding Q2 2020 level.
Average receivable collection period	An activity ratio equal to the number of days in the period divided by receivables turnover.	Merck & Co. Inc.’s number of days of receivables outstanding deteriorated from Q2 2020 to Q3 2020 but then improved from Q3 2020 to Q4 2020 not reaching Q2 2020 level.
Operating cycle	Equal to average inventory processing period plus average receivables collection period.	Merck & Co. Inc.’s operating cycle deteriorated from Q2 2020 to Q3 2020 but then improved from Q3 2020 to Q4 2020 exceeding Q2 2020 level.
Average payables payment period	An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period.	Merck & Co. Inc.’s number of days of payables outstanding increased from Q2 2020 to Q3 2020 and from Q3 2020 to Q4 2020.
Cash conversion cycle	A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period.	Merck & Co. Inc.’s cash conversion cycle deteriorated from Q2 2020 to Q3 2020 but then improved from Q3 2020 to Q4 2020 exceeding Q2 2020 level.

Merck & Co. Inc., inventory turnover calculation (quarterly data)

		Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020		Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019		Dec 31, 2018	Sep 30, 2018	Jun 30, 2018	Mar 31, 2018		Dec 31, 2017	Sep 30, 2017	Jun 30, 2017	Mar 31, 2017		Dec 31, 2016	Sep 30, 2016	Jun 30, 2016	Mar 31, 2016
	Selected Financial Data (US$ in millions)
	Cost of sales
	Inventories, excludes inventories classified in Other assets
	Short-term Activity Ratio
	Inventory turnover¹
	Benchmarks
	Inventory Turnover, Competitors²
	Abbott Laboratories
	AbbVie Inc.
	Amgen Inc.
	Bristol-Myers Squibb Co.
	Eli Lilly & Co.
	Gilead Sciences Inc.
	Illumina Inc.
	Johnson & Johnson
	Pfizer Inc.
	Regeneron Pharmaceuticals Inc.
	Vertex Pharmaceuticals Inc.
	Zoetis Inc.

¹ Q4 2020 Calculation
Inventory turnover = (Cost of sales_{Q4 2020} + Cost of sales_{Q3 2020} + Cost of sales_{Q2 2020} + Cost of sales_{Q1 2020}) ÷ Inventories, excludes inventories classified in Other assets
= ( + + + ) ÷ =

² Click competitor name to see calculations.

Short-term activity ratio	Description	The company
Inventory turnover	An activity ratio calculated as cost of goods sold divided by inventory.	Merck & Co. Inc.’s inventory turnover ratio deteriorated from Q2 2020 to Q3 2020 but then improved from Q3 2020 to Q4 2020 exceeding Q2 2020 level.

Merck & Co. Inc., receivables turnover calculation (quarterly data)

		Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020		Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019		Dec 31, 2018	Sep 30, 2018	Jun 30, 2018	Mar 31, 2018		Dec 31, 2017	Sep 30, 2017	Jun 30, 2017	Mar 31, 2017		Dec 31, 2016	Sep 30, 2016	Jun 30, 2016	Mar 31, 2016
	Selected Financial Data (US$ in millions)
	Sales
	Accounts receivable, net of allowance for doubtful accounts
	Short-term Activity Ratio
	Receivables turnover¹
	Benchmarks
	Receivables Turnover, Competitors²
	Abbott Laboratories
	AbbVie Inc.
	Amgen Inc.
	Eli Lilly & Co.
	Gilead Sciences Inc.
	Illumina Inc.
	Johnson & Johnson
	Pfizer Inc.
	Regeneron Pharmaceuticals Inc.
	Vertex Pharmaceuticals Inc.
	Zoetis Inc.

¹ Q4 2020 Calculation
Receivables turnover = (Sales_{Q4 2020} + Sales_{Q3 2020} + Sales_{Q2 2020} + Sales_{Q1 2020}) ÷ Accounts receivable, net of allowance for doubtful accounts
= ( + + + ) ÷ =

² Click competitor name to see calculations.

Short-term activity ratio	Description	The company
Receivables turnover	An activity ratio equal to revenue divided by receivables.	Merck & Co. Inc.’s receivables turnover ratio deteriorated from Q2 2020 to Q3 2020 but then improved from Q3 2020 to Q4 2020 not reaching Q2 2020 level.

Merck & Co. Inc., payables turnover calculation (quarterly data)

		Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020		Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019		Dec 31, 2018	Sep 30, 2018	Jun 30, 2018	Mar 31, 2018		Dec 31, 2017	Sep 30, 2017	Jun 30, 2017	Mar 31, 2017		Dec 31, 2016	Sep 30, 2016	Jun 30, 2016	Mar 31, 2016
	Selected Financial Data (US$ in millions)
	Cost of sales
	Trade accounts payable
	Short-term Activity Ratio
	Payables turnover¹
	Benchmarks
	Payables Turnover, Competitors²
	Abbott Laboratories
	Amgen Inc.
	Bristol-Myers Squibb Co.
	Eli Lilly & Co.
	Gilead Sciences Inc.
	Illumina Inc.
	Johnson & Johnson
	Pfizer Inc.
	Regeneron Pharmaceuticals Inc.
	Vertex Pharmaceuticals Inc.
	Zoetis Inc.

¹ Q4 2020 Calculation
Payables turnover = (Cost of sales_{Q4 2020} + Cost of sales_{Q3 2020} + Cost of sales_{Q2 2020} + Cost of sales_{Q1 2020}) ÷ Trade accounts payable
= ( + + + ) ÷ =

² Click competitor name to see calculations.

Short-term activity ratio	Description	The company
Payables turnover	An activity ratio calculated as cost of goods sold divided by payables.	Merck & Co. Inc.’s payables turnover ratio decreased from Q2 2020 to Q3 2020 and from Q3 2020 to Q4 2020.

Merck & Co. Inc., working capital turnover calculation (quarterly data)

		Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020		Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019		Dec 31, 2018	Sep 30, 2018	Jun 30, 2018	Mar 31, 2018		Dec 31, 2017	Sep 30, 2017	Jun 30, 2017	Mar 31, 2017		Dec 31, 2016	Sep 30, 2016	Jun 30, 2016	Mar 31, 2016
	Selected Financial Data (US$ in millions)
	Current assets
	Less: Current liabilities
	Working capital

	Sales
	Short-term Activity Ratio
	Working capital turnover¹
	Benchmarks
	Working Capital Turnover, Competitors²
	Abbott Laboratories
	AbbVie Inc.
	Amgen Inc.
	Bristol-Myers Squibb Co.
	Eli Lilly & Co.
	Gilead Sciences Inc.
	Illumina Inc.
	Johnson & Johnson
	Pfizer Inc.
	Regeneron Pharmaceuticals Inc.
	Vertex Pharmaceuticals Inc.
	Zoetis Inc.

¹ Q4 2020 Calculation
Working capital turnover = (Sales_{Q4 2020} + Sales_{Q3 2020} + Sales_{Q2 2020} + Sales_{Q1 2020}) ÷ Working capital
= ( + + + ) ÷ =

² Click competitor name to see calculations.

Short-term activity ratio	Description	The company
Working capital turnover	An activity ratio calculated as revenue divided by working capital.	Merck & Co. Inc.’s working capital turnover ratio improved from Q2 2020 to Q3 2020 and from Q3 2020 to Q4 2020.

Merck & Co. Inc., average inventory processing period calculation (quarterly data)

		Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020		Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019		Dec 31, 2018	Sep 30, 2018	Jun 30, 2018	Mar 31, 2018		Dec 31, 2017	Sep 30, 2017	Jun 30, 2017	Mar 31, 2017		Dec 31, 2016	Sep 30, 2016	Jun 30, 2016	Mar 31, 2016
	Selected Financial Data
	Inventory turnover
	Short-term Activity Ratio (no. days)
	Average inventory processing period¹
	Benchmarks (no. days)
	Average Inventory Processing Period, Competitors²
	Abbott Laboratories
	AbbVie Inc.
	Amgen Inc.
	Bristol-Myers Squibb Co.
	Eli Lilly & Co.
	Gilead Sciences Inc.
	Illumina Inc.
	Johnson & Johnson
	Pfizer Inc.
	Regeneron Pharmaceuticals Inc.
	Vertex Pharmaceuticals Inc.
	Zoetis Inc.

¹ Q4 2020 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ =

² Click competitor name to see calculations.

Short-term activity ratio	Description	The company
Average inventory processing period	An activity ratio equal to the number of days in the period divided by inventory turnover over the period.	Merck & Co. Inc.’s number of days of inventory outstanding deteriorated from Q2 2020 to Q3 2020 but then improved from Q3 2020 to Q4 2020 exceeding Q2 2020 level.

Merck & Co. Inc., average receivable collection period calculation (quarterly data)

		Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020		Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019		Dec 31, 2018	Sep 30, 2018	Jun 30, 2018	Mar 31, 2018		Dec 31, 2017	Sep 30, 2017	Jun 30, 2017	Mar 31, 2017		Dec 31, 2016	Sep 30, 2016	Jun 30, 2016	Mar 31, 2016
	Selected Financial Data
	Receivables turnover
	Short-term Activity Ratio (no. days)
	Average receivable collection period¹
	Benchmarks (no. days)
	Average Receivable Collection Period, Competitors²
	Abbott Laboratories
	AbbVie Inc.
	Amgen Inc.
	Eli Lilly & Co.
	Gilead Sciences Inc.
	Illumina Inc.
	Johnson & Johnson
	Pfizer Inc.
	Regeneron Pharmaceuticals Inc.
	Vertex Pharmaceuticals Inc.
	Zoetis Inc.

¹ Q4 2020 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ =

² Click competitor name to see calculations.

Short-term activity ratio	Description	The company
Average receivable collection period	An activity ratio equal to the number of days in the period divided by receivables turnover.	Merck & Co. Inc.’s number of days of receivables outstanding deteriorated from Q2 2020 to Q3 2020 but then improved from Q3 2020 to Q4 2020 not reaching Q2 2020 level.

Merck & Co. Inc., operating cycle calculation (quarterly data)

No. days

		Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020		Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019		Dec 31, 2018	Sep 30, 2018	Jun 30, 2018	Mar 31, 2018		Dec 31, 2017	Sep 30, 2017	Jun 30, 2017	Mar 31, 2017		Dec 31, 2016	Sep 30, 2016	Jun 30, 2016	Mar 31, 2016
	Selected Financial Data
	Average inventory processing period
	Average receivable collection period
	Short-term Activity Ratio
	Operating cycle¹
	Benchmarks
	Operating Cycle, Competitors²
	Abbott Laboratories
	AbbVie Inc.
	Amgen Inc.
	Eli Lilly & Co.
	Gilead Sciences Inc.
	Illumina Inc.
	Johnson & Johnson
	Pfizer Inc.
	Regeneron Pharmaceuticals Inc.
	Vertex Pharmaceuticals Inc.
	Zoetis Inc.

¹ Q4 2020 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= + =

² Click competitor name to see calculations.

Short-term activity ratio	Description	The company
Operating cycle	Equal to average inventory processing period plus average receivables collection period.	Merck & Co. Inc.’s operating cycle deteriorated from Q2 2020 to Q3 2020 but then improved from Q3 2020 to Q4 2020 exceeding Q2 2020 level.

Merck & Co. Inc., average payables payment period calculation (quarterly data)

		Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020		Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019		Dec 31, 2018	Sep 30, 2018	Jun 30, 2018	Mar 31, 2018		Dec 31, 2017	Sep 30, 2017	Jun 30, 2017	Mar 31, 2017		Dec 31, 2016	Sep 30, 2016	Jun 30, 2016	Mar 31, 2016
	Selected Financial Data
	Payables turnover
	Short-term Activity Ratio (no. days)
	Average payables payment period¹
	Benchmarks (no. days)
	Average Payables Payment Period, Competitors²
	Abbott Laboratories
	Amgen Inc.
	Bristol-Myers Squibb Co.
	Eli Lilly & Co.
	Gilead Sciences Inc.
	Illumina Inc.
	Johnson & Johnson
	Pfizer Inc.
	Regeneron Pharmaceuticals Inc.
	Vertex Pharmaceuticals Inc.
	Zoetis Inc.

¹ Q4 2020 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ =

² Click competitor name to see calculations.

Short-term activity ratio	Description	The company
Average payables payment period	An estimate of the average number of days it takes a company to pay its suppliers; equal to the number of days in the period divided by payables turnover ratio for the period.	Merck & Co. Inc.’s number of days of payables outstanding increased from Q2 2020 to Q3 2020 and from Q3 2020 to Q4 2020.

Merck & Co. Inc., cash conversion cycle calculation (quarterly data)

No. days

		Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020		Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019		Dec 31, 2018	Sep 30, 2018	Jun 30, 2018	Mar 31, 2018		Dec 31, 2017	Sep 30, 2017	Jun 30, 2017	Mar 31, 2017		Dec 31, 2016	Sep 30, 2016	Jun 30, 2016	Mar 31, 2016
	Selected Financial Data
	Average inventory processing period
	Average receivable collection period
	Average payables payment period
	Short-term Activity Ratio
	Cash conversion cycle¹
	Benchmarks
	Cash Conversion Cycle, Competitors²
	Abbott Laboratories
	Amgen Inc.
	Eli Lilly & Co.
	Gilead Sciences Inc.
	Illumina Inc.
	Johnson & Johnson
	Pfizer Inc.
	Regeneron Pharmaceuticals Inc.
	Vertex Pharmaceuticals Inc.
	Zoetis Inc.

¹ Q4 2020 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= + – =

² Click competitor name to see calculations.

Short-term activity ratio	Description	The company
Cash conversion cycle	A financial metric that measures the length of time required for a company to convert cash invested in its operations to cash received as a result of its operations; equal to average inventory processing period plus average receivables collection period minus average payables payment period.	Merck & Co. Inc.’s cash conversion cycle deteriorated from Q2 2020 to Q3 2020 but then improved from Q3 2020 to Q4 2020 exceeding Q2 2020 level.

	Merck & Co. Inc.	Other companies (not purchased previously)
Financial Statements
Common-Size Financial Statements
Analysis of Financial Ratios
Relative Valuation
Discounted Cash Flow (DCF) Valuation
Economic Value Added (EVA)
Long-term Trends
Analysis of Components of Financial Statements
Financial Reporting Quality

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Financial Statements
Common-Size Financial Statements
Analysis of Financial Ratios
Relative Valuation
Discounted Cash Flow (DCF) Valuation
Economic Value Added (EVA)
Long-term Trends
Analysis of Components of Financial Statements
Financial Reporting Quality

Merck & Co. Inc. (NYSE:MRK)

Analysis of Short-term (Operating) Activity Ratios
Quarterly Data

Short-term Activity Ratios (Summary)

Inventory Turnover

Receivables Turnover

Payables Turnover

Working Capital Turnover

Average Inventory Processing Period

Average Receivable Collection Period

Operating Cycle

Average Payables Payment Period

Cash Conversion Cycle

Merck & Co. Inc. (NYSE:MRK)

Analysis of Short-term (Operating) Activity RatiosQuarterly Data

Short-term Activity Ratios (Summary)

Inventory Turnover

Receivables Turnover

Payables Turnover

Working Capital Turnover

Average Inventory Processing Period

Average Receivable Collection Period

Operating Cycle

Average Payables Payment Period

Cash Conversion Cycle

Analysis of Short-term (Operating) Activity Ratios
Quarterly Data