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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- Income Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Liquidity Ratios
- Analysis of Solvency Ratios
- Common Stock Valuation Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Operating Profit Margin since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Sales (P/S) since 2005
- Analysis of Debt
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Long-term Activity Ratios (Summary)
RTX Corp., long-term (investment) activity ratios
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| 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: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
An examination of long-term investment activity ratios reveals generally positive trends across the five-year period. Asset utilization efficiency appears to be improving, as indicated by increasing turnover ratios. The rate of improvement varies across different asset bases, with equity turnover demonstrating the most substantial gains.
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio exhibits a modest upward trend, increasing from 4.30 in 2021 to 5.25 in 2025. While there is a slight dip from 4.42 in 2022 to 4.38 in 2023, the ratio recovers and accelerates its growth in the subsequent years. This suggests increasing efficiency in generating revenue from fixed assets.
- Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)
- Similar to the standard net fixed asset turnover, this ratio also shows an increasing trend, moving from 3.80 in 2021 to 4.72 in 2025. The pattern of growth is consistent, though the absolute values are lower than those observed without considering operating leases and right-of-use assets. This indicates that including these assets moderately reduces the apparent efficiency of fixed asset utilization.
- Total Asset Turnover
- The total asset turnover ratio demonstrates a consistent, albeit gradual, increase from 0.40 in 2021 to 0.52 in 2025. This signifies improved efficiency in utilizing all assets to generate revenue. The increase is steady, suggesting a consistent improvement in overall asset management.
- Equity Turnover
- The equity turnover ratio experiences the most significant growth, rising from 0.88 in 2021 to 1.36 in 2025. This substantial increase suggests a considerable improvement in the company’s ability to generate revenue from shareholder equity. The acceleration in growth is particularly noticeable from 2023 onwards, indicating a strengthening relationship between equity investment and revenue generation.
Collectively, these ratios suggest a positive trajectory in asset utilization and efficiency. The increasing turnover ratios across different asset bases indicate that the company is becoming more effective at converting investments into revenue.
Net Fixed Asset Turnover
RTX Corp., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | ||||||
| Fixed assets, net | ||||||
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | ||||||
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Boeing Co. | ||||||
| Caterpillar Inc. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| Net Fixed Asset Turnover, Sector | ||||||
| Capital Goods | ||||||
| Net Fixed Asset Turnover, Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Net fixed asset turnover = Net sales ÷ Fixed assets, net
= ÷ =
2 Click competitor name to see calculations.
The net fixed asset turnover ratio exhibits an overall upward trend between 2021 and 2025. Initial values indicate a ratio of 4.30 in 2021, increasing to 4.42 in 2022, and slightly decreasing to 4.38 in 2023. A more pronounced increase is then observed, with the ratio reaching 5.02 in 2024 and further rising to 5.25 in 2025.
- Net Sales Trend
- Net sales demonstrate consistent growth throughout the period. From $64,388 million in 2021, sales increased to $67,074 million in 2022, $68,920 million in 2023, $80,738 million in 2024, and culminated at $88,603 million in 2025. This positive trajectory in sales likely contributes to the observed increase in the net fixed asset turnover ratio.
- Fixed Assets, Net Trend
- Fixed assets, net, also increased over the five-year period, though at a slower rate than net sales. Beginning at $14,972 million in 2021, net fixed assets grew to $15,170 million in 2022, $15,748 million in 2023, $16,089 million in 2024, and $16,868 million in 2025. The comparatively slower growth in fixed assets, relative to sales, is a key driver of the increasing turnover ratio.
- Net Fixed Asset Turnover Ratio Interpretation
- The net fixed asset turnover ratio measures the efficiency with which a company utilizes its fixed assets to generate sales. The increasing trend suggests improving efficiency in asset utilization. The rise from 4.30 to 5.25 indicates that, for each dollar invested in fixed assets, the company is generating progressively more revenue. The most significant improvement occurred between 2023 and 2024, coinciding with a substantial increase in net sales.
In summary, the observed trends suggest a strengthening relationship between fixed asset investment and revenue generation. The company appears to be effectively leveraging its fixed assets to support sales growth.
Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
RTX Corp., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | ||||||
| Fixed assets, net | ||||||
| Operating lease right-of-use assets | ||||||
| Fixed assets, 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 | ||||||
| Boeing Co. | ||||||
| Caterpillar Inc. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Capital Goods | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset) = Net sales ÷ Fixed assets, net (including operating lease, right-of-use asset)
= ÷ =
2 Click competitor name to see calculations.
The net fixed asset turnover ratio demonstrates a consistent upward trend over the five-year period. This indicates increasing efficiency in utilizing fixed assets to generate sales revenue. Net sales have also increased steadily throughout the period, contributing to this improved turnover.
- Net Sales Trend
- Net sales increased from US$64,388 million in 2021 to US$88,603 million in 2025. This represents a cumulative growth of approximately 37.8% over the five years. The growth rate appears to be accelerating, with larger increases observed in 2024 and 2025.
- Fixed Assets Trend
- Fixed assets, net of accumulated depreciation and including operating lease right-of-use assets, have also increased, albeit at a slower pace than net sales. The value rose from US$16,930 million in 2021 to US$18,755 million in 2025, a cumulative increase of approximately 10.8%. The rate of increase in fixed assets appears relatively stable year-over-year.
- Net Fixed Asset Turnover Ratio
- The net fixed asset turnover ratio began at 3.80 in 2021 and increased to 4.72 in 2025. The ratio experienced moderate growth from 2021 to 2023, increasing from 3.80 to 3.96. A more substantial increase occurred between 2023 and 2024, reaching 4.50, and continued into 2025, reaching 4.72. This suggests that the company is becoming increasingly effective at generating sales from its fixed asset base. The accelerating ratio, coupled with increasing sales, suggests successful capital expenditure decisions and/or improved asset utilization strategies.
The consistent increase in the net fixed asset turnover ratio is a positive indicator of operational efficiency. The company appears to be effectively managing its fixed asset investments to support revenue growth.
Total Asset Turnover
RTX Corp., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | ||||||
| Total assets | ||||||
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | ||||||
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Boeing Co. | ||||||
| Caterpillar Inc. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| Total Asset Turnover, Sector | ||||||
| Capital Goods | ||||||
| Total Asset Turnover, Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Total asset turnover = Net sales ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
The total asset turnover ratio exhibits a consistent upward trend over the five-year period. This indicates increasing efficiency in utilizing assets to generate sales revenue.
- Total Asset Turnover Trend
- The ratio began at 0.40 in 2021 and increased to 0.42 in 2022, representing a modest initial improvement. The increase continued to 0.43 in 2023. A more substantial rise was observed between 2023 and 2024, with the ratio reaching 0.50. This upward momentum persisted into 2025, culminating in a ratio of 0.52.
Concurrently, net sales demonstrated growth throughout the period, increasing from US$64,388 million in 2021 to US$88,603 million in 2025. Total assets experienced fluctuations, decreasing slightly in 2022 before stabilizing and then increasing in subsequent years, moving from US$161,404 million in 2021 to US$171,079 million in 2025.
- Relationship between Sales and Assets
- The increasing total asset turnover ratio, alongside growing net sales and a moderate increase in total assets, suggests that the company is becoming more effective at converting its investments in assets into revenue. The more significant increases in the ratio in 2024 and 2025 suggest accelerating efficiency gains.
The observed trend implies improved operational performance and potentially enhanced management of assets. Further investigation into the drivers of these changes, such as changes in sales strategies, asset management practices, or industry dynamics, would provide a more comprehensive understanding.
Equity Turnover
RTX Corp., equity turnover calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | ||||||
| Shareowners’ equity | ||||||
| Long-term Activity Ratio | ||||||
| Equity turnover1 | ||||||
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Boeing Co. | ||||||
| Caterpillar Inc. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| Equity Turnover, Sector | ||||||
| Capital Goods | ||||||
| Equity Turnover, Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Equity turnover = Net sales ÷ Shareowners’ equity
= ÷ =
2 Click competitor name to see calculations.
The equity turnover ratio for the analyzed period demonstrates a consistent upward trend. Initially, the ratio was relatively stable, then increased significantly over the observed timeframe.
- Net Sales
- Net sales exhibited a generally positive trajectory, increasing from US$64,388 million in 2021 to US$88,603 million in 2025. The most substantial increase occurred between 2023 and 2024, with a jump to US$80,738 million. Growth continued, albeit at a slower pace, into 2025.
- Shareowners’ Equity
- Shareowners’ equity experienced a decline from 2021 to 2023, decreasing from US$73,068 million to US$59,798 million. It then showed modest recovery in 2024 and 2025, reaching US$65,245 million. The decrease in equity, coupled with increasing sales, is a key driver of the equity turnover ratio’s behavior.
- Equity Turnover
- The equity turnover ratio, calculated as net sales divided by shareowners’ equity, began at 0.88 in 2021 and rose to 0.92 in 2022. A more pronounced increase followed, reaching 1.15 in 2023 and further climbing to 1.34 in 2024. The ratio stabilized slightly in 2025 at 1.36. This indicates that the company is generating more sales revenue for each dollar of equity invested. The initial increases were likely driven by the decline in equity, while the continued, though smaller, increases in later years reflect sustained sales growth alongside a relatively stable equity base.
The increasing equity turnover ratio suggests improved efficiency in utilizing equity financing to generate sales. However, the initial decline in shareowners’ equity warrants further investigation to understand the underlying causes, such as share repurchases, dividend payouts, or accumulated losses.