Analysis of Short-term (Operating) Activity Ratios
Beginner level
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)
Raytheon Co., short-term (operating) activity ratios
Based on: 10-K (filing date: 2020-02-12), 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10).
| Short-term activity ratio | Description | The company |
|---|---|---|
| Inventory turnover | An activity ratio calculated as cost of goods sold divided by inventory. | Raytheon Co.’s inventory turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level. |
| Receivables turnover | An activity ratio equal to revenue divided by receivables. | Raytheon Co.’s receivables turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level. |
| Payables turnover | An activity ratio calculated as cost of goods sold divided by payables. | Raytheon Co.’s payables turnover ratio decreased from 2017 to 2018 but then increased from 2018 to 2019 not reaching 2017 level. |
| Working capital turnover | An activity ratio calculated as revenue divided by working capital. | Raytheon Co.’s working capital turnover ratio improved from 2017 to 2018 and from 2018 to 2019. |
| 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. | |
| Average receivable collection period | An activity ratio equal to the number of days in the period divided by receivables turnover. | Raytheon Co.’s number of days of receivables outstanding deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level. |
| Operating cycle | Equal to average inventory processing period plus average receivables collection period. | Raytheon Co.’s operating cycle deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 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. | Raytheon Co.’s number of days of payables outstanding increased from 2017 to 2018 but then slightly decreased from 2018 to 2019 not reaching 2017 level. |
| 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. | Raytheon Co.’s cash conversion cycle improved from 2017 to 2018 and from 2018 to 2019. |
Inventory Turnover
Raytheon Co., inventory turnover calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cost of sales, products and services | 21,413 | 19,573 | 19,076 | 17,947 | 17,574 | |
| Inventories | 671 | 758 | 594 | 659 | 635 | |
| Short-term Activity Ratio | ||||||
| Inventory turnover1 | 31.91 | 25.82 | 32.11 | 27.23 | 27.68 | |
| Benchmarks | ||||||
| Inventory Turnover, Competitors2 | ||||||
| Boeing Co. | 0.94 | 1.30 | 1.71 | 1.87 | 1.74 | |
| General Dynamics Corp. | 5.12 | 4.93 | 4.67 | 7.13 | 7.53 | |
| Lockheed Martin Corp. | 14.22 | 15.51 | 10.14 | 9.03 | 8.25 | |
| Northrop Grumman Corp. | 33.95 | 35.63 | 25.45 | 22.95 | 22.16 | |
| Raytheon Technologies Corp. | 5.21 | 4.96 | 4.45 | 4.76 | 4.97 | |
| Inventory Turnover, Sector | ||||||
| Aerospace & Defense | 2.44 | 2.80 | 3.24 | 3.42 | 3.20 | |
| Inventory Turnover, Industry | ||||||
| Industrials | 3.43 | 3.88 | 4.09 | 4.18 | 3.97 | |
Based on: 10-K (filing date: 2020-02-12), 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10).
1 2019 Calculation
Inventory turnover = Cost of sales, products and services ÷ Inventories
= 21,413 ÷ 671 = 31.91
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. | Raytheon Co.’s inventory turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level. |
Receivables Turnover
Raytheon Co., receivables turnover calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net sales | 29,176 | 27,058 | 25,348 | 24,069 | 23,247 | |
| Receivables, net | 1,364 | 1,648 | 1,324 | 1,218 | 1,169 | |
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | 21.39 | 16.42 | 19.15 | 19.76 | 19.89 | |
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Boeing Co. | 23.44 | 26.07 | 8.88 | 10.71 | 11.03 | |
| General Dynamics Corp. | 11.10 | 9.63 | 8.56 | 8.68 | 9.13 | |
| Lockheed Martin Corp. | 25.59 | 22.00 | 5.93 | 5.76 | 5.72 | |
| Northrop Grumman Corp. | 25.52 | 20.78 | 6.49 | 7.43 | 8.28 | |
| Raytheon Technologies Corp. | 5.70 | 4.66 | 4.75 | 4.99 | 5.27 | |
| Receivables Turnover, Sector | ||||||
| Aerospace & Defense | 11.94 | 11.15 | 6.64 | 7.20 | 7.51 | |
| Receivables Turnover, Industry | ||||||
| Industrials | 7.83 | 7.99 | 6.21 | 6.52 | 6.47 | |
Based on: 10-K (filing date: 2020-02-12), 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10).
1 2019 Calculation
Receivables turnover = Net sales ÷ Receivables, net
= 29,176 ÷ 1,364 = 21.39
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. | Raytheon Co.’s receivables turnover ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level. |
Payables Turnover
Raytheon Co., payables turnover calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cost of sales, products and services | 21,413 | 19,573 | 19,076 | 17,947 | 17,574 | |
| Accounts payable | 1,796 | 1,964 | 1,519 | 1,520 | 1,402 | |
| Short-term Activity Ratio | ||||||
| Payables turnover1 | 11.92 | 9.97 | 12.56 | 11.81 | 12.53 | |
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Boeing Co. | 4.63 | 6.30 | 6.23 | 7.21 | 7.59 | |
| General Dynamics Corp. | 10.21 | 9.27 | 7.73 | 9.89 | 12.90 | |
| Lockheed Martin Corp. | 40.16 | 19.35 | 31.02 | 25.52 | 20.74 | |
| Northrop Grumman Corp. | 11.94 | 10.68 | 11.95 | 12.05 | 13.95 | |
| Raytheon Technologies Corp. | 5.28 | 4.51 | 4.59 | 5.54 | 5.88 | |
| Payables Turnover, Sector | ||||||
| Aerospace & Defense | 7.25 | 7.26 | 7.47 | 8.53 | 9.02 | |
| Payables Turnover, Industry | ||||||
| Industrials | 6.32 | 6.56 | 6.61 | 7.35 | 7.67 | |
Based on: 10-K (filing date: 2020-02-12), 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10).
1 2019 Calculation
Payables turnover = Cost of sales, products and services ÷ Accounts payable
= 21,413 ÷ 1,796 = 11.92
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. | Raytheon Co.’s payables turnover ratio decreased from 2017 to 2018 but then increased from 2018 to 2019 not reaching 2017 level. |
Working Capital Turnover
Raytheon Co., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | 13,082 | 12,136 | 11,326 | 10,678 | 9,812 | |
| Less: Current liabilities | 9,791 | 8,288 | 7,348 | 6,427 | 6,126 | |
| Working capital | 3,291 | 3,848 | 3,978 | 4,251 | 3,686 | |
| Net sales | 29,176 | 27,058 | 25,348 | 24,069 | 23,247 | |
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | 8.87 | 7.03 | 6.37 | 5.66 | 6.31 | |
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Boeing Co. | 15.57 | 16.21 | 10.50 | 7.66 | 5.39 | |
| General Dynamics Corp. | 13.21 | 10.49 | 5.92 | 12.05 | 14.80 | |
| Lockheed Martin Corp. | 19.15 | 31.53 | 10.58 | 18.41 | 21.55 | |
| Northrop Grumman Corp. | 27.05 | 21.40 | 2.75 | 19.99 | 26.83 | |
| Raytheon Technologies Corp. | 26.47 | 16.08 | 7.07 | 8.62 | 13.72 | |
| Working Capital Turnover, Sector | ||||||
| Aerospace & Defense | 18.88 | 16.99 | 7.09 | 10.04 | 9.36 | |
| Working Capital Turnover, Industry | ||||||
| Industrials | 6.90 | 7.10 | 4.82 | 4.81 | 5.39 | |
Based on: 10-K (filing date: 2020-02-12), 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10).
1 2019 Calculation
Working capital turnover = Net sales ÷ Working capital
= 29,176 ÷ 3,291 = 8.87
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. | Raytheon Co.’s working capital turnover ratio improved from 2017 to 2018 and from 2018 to 2019. |
Average Inventory Processing Period
Raytheon Co., average inventory processing period calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Inventory turnover | 31.91 | 25.82 | 32.11 | 27.23 | 27.68 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average inventory processing period1 | 11 | 14 | 11 | 13 | 13 | |
| Benchmarks (no. days) | ||||||
| Average Inventory Processing Period, Competitors2 | ||||||
| Boeing Co. | 388 | 280 | 213 | 195 | 210 | |
| General Dynamics Corp. | 71 | 74 | 78 | 51 | 48 | |
| Lockheed Martin Corp. | 26 | 24 | 36 | 40 | 44 | |
| Northrop Grumman Corp. | 11 | 10 | 14 | 16 | 16 | |
| Raytheon Technologies Corp. | 70 | 74 | 82 | 77 | 73 | |
| Average Inventory Processing Period, Sector | ||||||
| Aerospace & Defense | 150 | 130 | 113 | 107 | 114 | |
| Average Inventory Processing Period, Industry | ||||||
| Industrials | 106 | 94 | 89 | 87 | 92 | |
Based on: 10-K (filing date: 2020-02-12), 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10).
1 2019 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 31.91 = 11
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. |
Average Receivable Collection Period
Raytheon Co., average receivable collection period calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | 21.39 | 16.42 | 19.15 | 19.76 | 19.89 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | 17 | 22 | 19 | 18 | 18 | |
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Boeing Co. | 16 | 14 | 41 | 34 | 33 | |
| General Dynamics Corp. | 33 | 38 | 43 | 42 | 40 | |
| Lockheed Martin Corp. | 14 | 17 | 62 | 63 | 64 | |
| Northrop Grumman Corp. | 14 | 18 | 56 | 49 | 44 | |
| Raytheon Technologies Corp. | 64 | 78 | 77 | 73 | 69 | |
| Average Receivable Collection Period, Sector | ||||||
| Aerospace & Defense | 31 | 33 | 55 | 51 | 49 | |
| Average Receivable Collection Period, Industry | ||||||
| Industrials | 47 | 46 | 59 | 56 | 56 | |
Based on: 10-K (filing date: 2020-02-12), 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10).
1 2019 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 21.39 = 17
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. | Raytheon Co.’s number of days of receivables outstanding deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level. |
Operating Cycle
Raytheon Co., operating cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 11 | 14 | 11 | 13 | 13 | |
| Average receivable collection period | 17 | 22 | 19 | 18 | 18 | |
| Short-term Activity Ratio | ||||||
| Operating cycle1 | 28 | 36 | 30 | 31 | 31 | |
| Benchmarks | ||||||
| Operating Cycle, Competitors2 | ||||||
| Boeing Co. | 404 | 294 | 254 | 229 | 243 | |
| General Dynamics Corp. | 104 | 112 | 121 | 93 | 88 | |
| Lockheed Martin Corp. | 40 | 41 | 98 | 103 | 108 | |
| Northrop Grumman Corp. | 25 | 28 | 70 | 65 | 60 | |
| Raytheon Technologies Corp. | 134 | 152 | 159 | 150 | 142 | |
| Operating Cycle, Sector | ||||||
| Aerospace & Defense | 181 | 163 | 168 | 158 | 163 | |
| Operating Cycle, Industry | ||||||
| Industrials | 153 | 140 | 148 | 143 | 148 | |
Based on: 10-K (filing date: 2020-02-12), 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10).
1 2019 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 11 + 17 = 28
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. | Raytheon Co.’s operating cycle deteriorated from 2017 to 2018 but then improved from 2018 to 2019 exceeding 2017 level. |
Average Payables Payment Period
Raytheon Co., average payables payment period calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | 11.92 | 9.97 | 12.56 | 11.81 | 12.53 | |
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | 31 | 37 | 29 | 31 | 29 | |
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Boeing Co. | 79 | 58 | 59 | 51 | 48 | |
| General Dynamics Corp. | 36 | 39 | 47 | 37 | 28 | |
| Lockheed Martin Corp. | 9 | 19 | 12 | 14 | 18 | |
| Northrop Grumman Corp. | 31 | 34 | 31 | 30 | 26 | |
| Raytheon Technologies Corp. | 69 | 81 | 80 | 66 | 62 | |
| Average Payables Payment Period, Sector | ||||||
| Aerospace & Defense | 50 | 50 | 49 | 43 | 40 | |
| Average Payables Payment Period, Industry | ||||||
| Industrials | 58 | 56 | 55 | 50 | 48 | |
Based on: 10-K (filing date: 2020-02-12), 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10).
1 2019 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 11.92 = 31
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. | Raytheon Co.’s number of days of payables outstanding increased from 2017 to 2018 but then slightly decreased from 2018 to 2019 not reaching 2017 level. |
Cash Conversion Cycle
Raytheon Co., cash conversion cycle calculation, comparison to benchmarks
No. days
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Average inventory processing period | 11 | 14 | 11 | 13 | 13 | |
| Average receivable collection period | 17 | 22 | 19 | 18 | 18 | |
| Average payables payment period | 31 | 37 | 29 | 31 | 29 | |
| Short-term Activity Ratio | ||||||
| Cash conversion cycle1 | -3 | -1 | 1 | 0 | 2 | |
| Benchmarks | ||||||
| Cash Conversion Cycle, Competitors2 | ||||||
| Boeing Co. | 325 | 236 | 195 | 178 | 195 | |
| General Dynamics Corp. | 68 | 73 | 74 | 56 | 60 | |
| Lockheed Martin Corp. | 31 | 22 | 86 | 89 | 90 | |
| Northrop Grumman Corp. | -6 | -6 | 39 | 35 | 34 | |
| Raytheon Technologies Corp. | 65 | 71 | 79 | 84 | 80 | |
| Cash Conversion Cycle, Sector | ||||||
| Aerospace & Defense | 131 | 113 | 119 | 115 | 123 | |
| Cash Conversion Cycle, Industry | ||||||
| Industrials | 95 | 84 | 93 | 93 | 100 | |
Based on: 10-K (filing date: 2020-02-12), 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-14), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-10).
1 2019 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 11 + 17 – 31 = -3
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. | Raytheon Co.’s cash conversion cycle improved from 2017 to 2018 and from 2018 to 2019. |