Analysis of Geographic Areas
Raytheon Co. operates in 2 regions: United States and All other.
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- Balance Sheet: Liabilities and Stockholders’ Equity
- Cash Flow Statement
- Analysis of Profitability Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Common Stock Valuation Ratios
- Enterprise Value (EV)
- Present Value of Free Cash Flow to Equity (FCFE)
- Selected Financial Data since 2005
- Analysis of Revenues
- Analysis of Debt
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Area Asset Turnover
Raytheon Co., asset turnover by geographic area
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | |
|---|---|---|---|---|---|
| United States | |||||
| All other |
Based on: 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), 10-K (reporting date: 2015-12-31).
- United States Asset Turnover
- The annual asset turnover ratio in the United States shows a consistent downward trend from 2015 to 2019. It decreases steadily each year, starting at 8.35 in 2015 and falling to 6.33 by 2019. This indicates a gradual reduction in how efficiently assets in the United States were used to generate revenue over the five-year period.
- All Other Geographic Areas Asset Turnover
- The asset turnover ratio for all other geographic areas displays greater volatility compared to the United States. It begins at a high level of 92.86 in 2015, slightly increases to 93.23 in 2016, peaks significantly at 105 in 2017, then declines sharply to 91.07 in 2018, followed by a further drop to 84.14 in 2019. Despite the fluctuations, the ratio remains markedly higher than that of the United States, suggesting more intensive asset utilization outside the U.S., albeit with a decreasing trend in the last two recorded years.
- Overall Trend and Insights
- Across the observed periods, the asset turnover ratios demonstrate differing patterns between the two geographic segments. The United States shows a steady decline, indicating possible diminishing efficiency in asset utilization. Conversely, the non-U.S. segment experiences a peak in 2017 followed by a decline, hinting at possibly cyclical factors or operational changes impacting asset efficiency. The significantly higher values outside the U.S. suggest that assets in those regions are being turned over more rapidly, but the recent downward movement might warrant further investigation into the causes affecting asset productivity.
Area Asset Turnover: United States
Raytheon Co.; United States; area asset turnover calculation
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Net sales | |||||
| Property, plant and equipment, net | |||||
| Area Activity Ratio | |||||
| Area asset turnover1 | |||||
Based on: 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), 10-K (reporting date: 2015-12-31).
1 2019 Calculation
Area asset turnover = Net sales ÷ Property, plant and equipment, net
= ÷ =
- Net Sales
- Net sales exhibited a consistent upward trend over the five-year period. Starting at $16,097 million in 2015, sales increased each year, reaching $20,594 million in 2019. This represents a growth of approximately 28% over the period, indicating a steady expansion in revenue generated within the United States geographic area.
- Property, Plant, and Equipment, Net
- The net value of property, plant, and equipment showed a notable increase throughout the period. It rose from $1,928 million at the end of 2015 to $3,251 million by the end of 2019. This growth reflects an investment in fixed assets amounting to an increase of approximately 69%, suggesting ongoing capital expenditure and asset base enhancement within the region.
- Area Asset Turnover
- The area asset turnover ratio declined steadily each year from 8.35 in 2015 to 6.33 in 2019. This ratio measures the efficiency in using property, plant, and equipment to generate sales. The downward trend indicates that while both sales and assets increased, the asset base grew at a faster rate relative to sales, resulting in reduced turnover efficiency over time.
Area Asset Turnover: All other
Raytheon Co.; All other; area asset turnover calculation
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Net sales | |||||
| Property, plant and equipment, net | |||||
| Area Activity Ratio | |||||
| Area asset turnover1 | |||||
Based on: 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), 10-K (reporting date: 2015-12-31).
1 2019 Calculation
Area asset turnover = Net sales ÷ Property, plant and equipment, net
= ÷ =
The annual financial data for the "All other" geographic area reveals several notable trends over the five-year period ending December 31, 2019.
- Net Sales
- Net sales exhibited a steady upward trend, increasing from $7,150 million in 2015 to $8,582 million in 2019. This represents a cumulative growth of approximately 20% over the period, with consistent year-over-year increases, though the growth rate appears to moderate slightly towards the final year.
- Property, Plant and Equipment, Net
- The net value of property, plant, and equipment showed a moderate increase from $77 million in 2015 to $102 million in 2019. There was a slight dip in 2017 to $77 million, returning to a higher level in subsequent years, indicating possible asset renewal or expansion activities particularly after 2017.
- Area Asset Turnover
- The area asset turnover ratio, which measures efficiency in using assets to generate sales, started at a high level of 92.86 in 2015 and fluctuated over the period. It peaked in 2017 at 105 but then declined to 84.14 by 2019. This suggests a decreasing efficiency in asset utilization despite increasing net sales, likely influenced by the growth in asset base outpacing sales growth in the latter years.
Overall, the data indicates that while sales growth is positive and steady, the substantial increase in assets, particularly from 2018 onward, has not translated into corresponding improvements in asset turnover efficiency. This divergence points to potential strategic investments or operational changes affecting asset utilization in the "All other" geographic segment.
Property, plant and equipment, net
Raytheon Co., property, plant and equipment, net by geographic area
US$ in millions
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | |
|---|---|---|---|---|---|
| United States | |||||
| All other | |||||
| Total |
Based on: 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), 10-K (reporting date: 2015-12-31).
The property, plant, and equipment, net data segmented by geographic area indicates an overall increasing trend over the five-year period ending December 31, 2019.
- United States
- The net value of property, plant, and equipment in the United States shows a consistent upward movement from 1,928 million US dollars in 2015 to 3,251 million US dollars in 2019. This represents a significant increase of approximately 68.6% over the five years, highlighting substantial investment or valuation growth in this region. Year-on-year growth is steady, with no declines recorded in the period under review.
- All other regions
- The category labeled as "All other" also exhibits growth, though at a lower magnitude compared to the United States. Values increased from 77 million US dollars in 2015 to 102 million US dollars in 2019. This corresponds to a 32.5% rise over the five years, with a minor dip observed in 2017 compared to 2016, followed by recovery and continued growth thereafter.
- Total
- The total net property, plant, and equipment values align with the aggregate of the two geographical segments, increasing from 2,005 million US dollars in 2015 to 3,353 million US dollars in 2019. This total figure reflects an overall growth of 67.2%. The steady upward trend suggests consistent investments and asset accumulation across these geographic areas, driven primarily by the United States segment.
In summary, the data reveals a robust and sustained increase in net property, plant, and equipment values over the observed period, with the majority of growth concentrated in the United States. The "All other" category, while smaller in absolute terms, contributes to the overall positive trend with moderate expansion. These patterns may indicate strengthening capital asset bases in these regions, with potential implications for operational capacity and long-term strategic positioning.
Net sales
Raytheon Co., net sales by geographic area
US$ in millions
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | |
|---|---|---|---|---|---|
| United States | |||||
| All other | |||||
| Total |
Based on: 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), 10-K (reporting date: 2015-12-31).
- United States Net Sales
- The net sales in the United States show a consistent upward trend over the five-year period. Starting at $16,097 million in 2015, the sales increased steadily each year to reach $20,594 million in 2019. This represents an overall growth of approximately 28% over the period, indicating strong domestic market performance.
- All Other Geographic Areas Net Sales
- Net sales in the "All Other" category also demonstrate a gradual increase, though at a slower pace compared to the United States. Sales grew from $7,150 million in 2015 to $8,582 million in 2019, an increase of about 20%. The growth in this segment appears stable but less pronounced relative to domestic sales.
- Total Net Sales
- Total net sales, combining all geographic areas, exhibit a clear upward trajectory throughout the period. The total rose from $23,247 million in 2015 to $29,176 million in 2019, reflecting an overall growth of roughly 25%. This growth is primarily driven by increases in the United States market, supported by moderate gains in other regions.
- Summary of Trends
- The data suggests a robust growth pattern in net sales across all geographic areas, with the United States consistently contributing the larger share and experiencing higher growth rates. The "All Other" category shows stable but slower growth. Overall, the company’s geographic sales expansion appears steady and positive, with no signs of volatility or decline during the observed period.