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.
Long-term Activity Ratios (Summary)
United Parcel Service Inc., long-term (investment) activity ratios
Based on: 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), 10-K (reporting date: 2020-12-31).
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio demonstrates a fluctuating trend over the observed periods. It increased from 2.62 in 2020 to a peak of 2.91 in 2021, followed by a slight decline to 2.89 in 2022. Subsequent years show a more notable decrease to 2.46 in 2023 and a marginal drop to 2.45 in 2024. This indicates a reduction in efficiency of using fixed assets to generate revenue in the latest years compared to the peak in 2021.
- Net Fixed Asset Turnover Including Operating Lease, Right-of-Use Asset
- Considering operating lease and right-of-use assets, the turnover ratio follows a similar pattern to the net fixed asset turnover. It rises from 2.4 in 2020 to 2.63 in 2021, then remains relatively stable at 2.61 in 2022. Afterward, it decreases to 2.2 in both 2023 and 2024, signaling a decline in asset utilization efficiency when including leased assets in the more recent years.
- Total Asset Turnover
- Total asset turnover exhibits moderate variation. It slightly increased from 1.36 in 2020 to 1.4 in 2021 and further to 1.41 in 2022, indicating improving asset utilization. However, the ratio declines to 1.28 in 2023 before slightly recovering to 1.3 in 2024. This suggests a minor weakening in the efficiency of total asset use towards the end of the period under review.
- Equity Turnover
- The equity turnover ratio presents significant volatility across the years. It starts extremely high at 128.81 in 2020, then sharply falls to 6.83 in 2021 and continues to decrease to 5.07 in 2022. Following this decline, a modest upward trend is observed with values rising to 5.26 in 2023 and 5.45 in 2024. This pattern reflects substantial changes in how effectively equity is being used for generating revenue, with initial very high turnover followed by stabilization at a much lower level.
Net Fixed Asset Turnover
United Parcel Service Inc., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue | 91,070) | 90,958) | 100,338) | 97,287) | 84,628) | |
| Property, plant and equipment, net | 37,179) | 36,945) | 34,719) | 33,475) | 32,254) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | 2.45 | 2.46 | 2.89 | 2.91 | 2.62 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| FedEx Corp. | 2.11 | 2.22 | 2.45 | 2.35 | 2.06 | |
| Uber Technologies Inc. | 22.53 | 17.98 | 15.31 | 9.42 | 6.14 | |
| Union Pacific Corp. | 0.42 | 0.42 | 0.44 | 0.40 | 0.36 | |
| United Airlines Holdings Inc. | 1.33 | 1.35 | 1.31 | 0.77 | 0.49 | |
| Net Fixed Asset Turnover, Sector | ||||||
| Transportation | 1.67 | 1.67 | 1.79 | 1.55 | 1.30 | |
| Net Fixed Asset Turnover, Industry | ||||||
| Industrials | 2.76 | 2.86 | 2.94 | 2.72 | 2.17 | |
Based on: 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), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Net fixed asset turnover = Revenue ÷ Property, plant and equipment, net
= 91,070 ÷ 37,179 = 2.45
2 Click competitor name to see calculations.
- Revenue Trends
- Revenue showed a positive growth trend from 2020 through 2022, increasing from $84,628 million in 2020 to a peak of $100,338 million in 2022. However, this upward trend reversed in 2023, with revenue declining to $90,958 million and remaining relatively stable through 2024 at $91,070 million. This indicates a contraction in sales or service volume following a period of expansion.
- Property, Plant, and Equipment (Net)
- The net value of property, plant, and equipment exhibited a consistent upward trend over the five-year period. The balance increased steadily each year, from $32,254 million in 2020 to $37,179 million in 2024. This suggests ongoing investment in fixed assets or capital expenditures, reflecting expansion or maintenance of operational capacity.
- Net Fixed Asset Turnover Ratio
- The net fixed asset turnover ratio, which measures revenue generated per dollar of fixed assets, rose from 2.62 in 2020 to 2.91 in 2021, signalling improved efficiency in asset utilization. It slightly decreased to 2.89 in 2022 but experienced a more pronounced decline in 2023 to 2.46 and remained virtually unchanged in 2024 at 2.45. The decline in this ratio after 2021 corresponds with the revenue decrease, indicating reduced efficiency in generating sales from fixed assets despite continued asset growth.
- Summary Insight
- The data reveal a period of growth and increasing efficiency through 2021 followed by a contraction in revenue and a decline in asset utilization efficiency after 2022. Despite this, fixed assets have continued to grow steadily, which might indicate ongoing investments not yet matched by proportional revenue gains. This pattern may warrant further investigation into operational effectiveness or market conditions affecting revenue generation in the later years.
Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
United Parcel Service Inc., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue | 91,070) | 90,958) | 100,338) | 97,287) | 84,628) | |
| Property, plant and equipment, net | 37,179) | 36,945) | 34,719) | 33,475) | 32,254) | |
| Operating lease right-of-use assets | 4,149) | 4,308) | 3,755) | 3,562) | 3,073) | |
| Property, plant and equipment, net (including operating lease, right-of-use asset) | 41,328) | 41,253) | 38,474) | 37,037) | 35,327) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover (including operating lease, right-of-use asset)1 | 2.20 | 2.20 | 2.61 | 2.63 | 2.40 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Competitors2 | ||||||
| FedEx Corp. | 1.50 | 1.55 | 1.71 | 1.64 | 1.46 | |
| Uber Technologies Inc. | 14.14 | 11.25 | 9.03 | 5.39 | 3.61 | |
| Union Pacific Corp. | 0.41 | 0.41 | 0.43 | 0.38 | 0.35 | |
| United Airlines Holdings Inc. | 1.22 | 1.23 | 1.17 | 0.67 | 0.43 | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Transportation | 1.45 | 1.44 | 1.53 | 1.33 | 1.12 | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Industrials | 2.41 | 2.49 | 2.54 | 2.34 | 1.92 | |
Based on: 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), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset) = Revenue ÷ Property, plant and equipment, net (including operating lease, right-of-use asset)
= 91,070 ÷ 41,328 = 2.20
2 Click competitor name to see calculations.
- Revenue Trends
- Revenue exhibited an overall upward trend from 2020 to 2022, increasing from $84,628 million to $100,338 million. However, this growth was followed by a decline in 2023 to $90,958 million, with a marginal increase to $91,070 million in 2024. The data shows a peak in 2022, after which revenue levels stabilized at values slightly above 2020 but below the peak year.
- Property, Plant and Equipment (PPE), Net
- The net value of property, plant, and equipment (including operating lease, right-of-use asset) consistently increased throughout the period. Starting at $35,327 million in 2020, it rose steadily each year, reaching $41,328 million by the end of 2024. This indicates ongoing investment in fixed assets over the period analyzed.
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio, which measures the efficiency in using fixed assets to generate revenue, showed an improvement from 2.4 in 2020 to 2.63 in 2021, followed by a slight decrease to 2.61 in 2022. Subsequently, the ratio decreased more noticeably to 2.2 in 2023 and remained stable at that level in 2024. This pattern suggests that while asset utilization was efficient early on, there has been a reduction in the efficiency of generating revenue from fixed assets in more recent years.
- Summary of Observations
- The financial data reveals increasing asset bases with a consistent rise in property, plant, and equipment values, indicating capital expenditure or asset acquisition activity. Although revenue grew sharply until 2022, it declined thereafter and flatlined in 2024. The declining fixed asset turnover ratio in the last two years implies that asset utilization efficiency has decreased, possibly due to the revenue decline or increased asset base outpacing revenue growth. This could indicate a need to reassess asset deployment strategies or operational efficiency measures to improve revenue generation relative to fixed assets.
Total Asset Turnover
United Parcel Service Inc., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue | 91,070) | 90,958) | 100,338) | 97,287) | 84,628) | |
| Total assets | 70,070) | 70,857) | 71,124) | 69,405) | 62,408) | |
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | 1.30 | 1.28 | 1.41 | 1.40 | 1.36 | |
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| FedEx Corp. | 1.01 | 1.03 | 1.09 | 1.01 | 0.94 | |
| Uber Technologies Inc. | 0.86 | 0.96 | 0.99 | 0.45 | 0.33 | |
| Union Pacific Corp. | 0.36 | 0.36 | 0.38 | 0.34 | 0.31 | |
| United Airlines Holdings Inc. | 0.77 | 0.76 | 0.67 | 0.36 | 0.26 | |
| Total Asset Turnover, Sector | ||||||
| Transportation | 0.87 | 0.88 | 0.92 | 0.76 | 0.69 | |
| Total Asset Turnover, Industry | ||||||
| Industrials | 0.65 | 0.67 | 0.66 | 0.58 | 0.50 | |
Based on: 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), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Total asset turnover = Revenue ÷ Total assets
= 91,070 ÷ 70,070 = 1.30
2 Click competitor name to see calculations.
- Revenue
- The revenue showed a consistent upward trend from 2020 through 2022, increasing from 84,628 million US dollars to 100,338 million US dollars. However, in 2023, revenue declined noticeably to 90,958 million US dollars and remained relatively stable in 2024 at 91,070 million US dollars, indicating a plateau after a period of growth.
- Total Assets
- Total assets experienced an overall upward trajectory from 62,408 million US dollars in 2020 to a peak of 71,124 million US dollars in 2022. Thereafter, a slight decrease occurred, with total assets declining to 70,857 million US dollars in 2023 and further to 70,070 million US dollars in 2024. This suggests a stabilization phase after asset growth.
- Total Asset Turnover Ratio
- The total asset turnover ratio, which measures efficiency in using assets to generate revenue, showed a gradual increase from 1.36 in 2020 to 1.41 in 2022. A decline was then observed in 2023 to 1.28, followed by a minor recovery to 1.30 in 2024. This pattern implies that the company's asset utilization efficiency improved initially but then weakened, aligning with the revenue decline in the latter years.
Equity Turnover
United Parcel Service Inc., equity turnover calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue | 91,070) | 90,958) | 100,338) | 97,287) | 84,628) | |
| Equity for controlling interests | 16,718) | 17,306) | 19,786) | 14,253) | 657) | |
| Long-term Activity Ratio | ||||||
| Equity turnover1 | 5.45 | 5.26 | 5.07 | 6.83 | 128.81 | |
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| FedEx Corp. | 3.18 | 3.46 | 3.75 | 3.47 | 3.78 | |
| Uber Technologies Inc. | 2.04 | 3.31 | 4.34 | 1.21 | 0.91 | |
| Union Pacific Corp. | 1.44 | 1.63 | 2.05 | 1.54 | 1.15 | |
| United Airlines Holdings Inc. | 4.50 | 5.76 | 6.52 | 4.90 | 2.58 | |
| Equity Turnover, Sector | ||||||
| Transportation | 3.19 | 3.76 | 4.16 | 3.40 | 3.69 | |
| Equity Turnover, Industry | ||||||
| Industrials | 2.92 | 3.33 | 3.06 | 2.63 | 2.75 | |
Based on: 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), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Equity turnover = Revenue ÷ Equity for controlling interests
= 91,070 ÷ 16,718 = 5.45
2 Click competitor name to see calculations.
- Revenue Trends
- The annual revenue experienced an overall upward trajectory from 2020 to 2022, increasing from 84,628 million US dollars to 100,338 million US dollars. However, there was a notable decline in 2023, with revenue dropping to 90,958 million US dollars, which slightly stabilized in 2024 at 91,070 million US dollars. This indicates a peak in 2022 followed by a correction or slower growth phase in the subsequent two years.
- Equity for Controlling Interests
- The equity attributable to controlling interests rose significantly from 657 million US dollars in 2020 to 14,253 million US dollars in 2021, continuing to grow to 19,786 million US dollars in 2022. However, equity then decreased in 2023 to 17,306 million US dollars and further declined to 16,718 million US dollars in 2024. This pattern shows a period of substantial equity growth followed by a reduction, which may reflect changes in retained earnings, distributions, or valuation adjustments.
- Equity Turnover Ratio
- The equity turnover ratio, which measures revenue generation relative to equity, exhibited a sharp decline from a very high level of 128.81 in 2020 to 6.83 in 2021. Following that, it continued decreasing to 5.07 in 2022 but showed slight improvements in 2023 and 2024, increasing to 5.26 and 5.45, respectively. The initial drastic drop suggests a large increase in equity relative to revenue, which normalized somewhat in the later years as equity decreased and revenue stabilized.
- Summary Insights
- The data reveals that while revenue peaked in 2022 and then tapered off slightly, equity for controlling interests experienced rapid growth in the early years followed by a moderate decline. The equity turnover ratio reflects these changes, with an initial extreme decrease due to the surge in equity, followed by stabilization. These patterns could imply significant capital injections or retained earnings growth in the early period, with subsequent adjustments or distributions impacting the equity levels more recently. The company's ability to generate revenue relative to its equity base diminished substantially from 2020 onward but appears to have stabilized in the last two years.