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)
Valero Energy Corp., long-term (investment) activity ratios
Based on: 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), 10-K (reporting date: 2019-12-31).
The investment activity ratios exhibit a pronounced cyclical trend between 2019 and 2023, marked by a significant decline in efficiency during 2020 followed by a strong recovery that peaked in 2022. The synchronized movement across all measured turnover ratios suggests that the fluctuations were driven by broader revenue volatility rather than structural changes in the asset base.
- Fixed Asset Utilization
- Net fixed asset turnover experienced a sharp contraction in 2020, falling from 3.70 to 2.14. A robust recovery followed, with the ratio increasing to 3.69 in 2021 and reaching a peak of 5.69 in 2022. By 2023, the ratio moderated to 4.79, which remains significantly higher than the 2019 baseline. The inclusion of right-of-use assets in this calculation yielded nearly identical trends, with a 2022 peak of 5.50, indicating that operating leases do not materially alter the observed efficiency patterns.
- Overall Asset Efficiency
- Total asset turnover mirrored the trajectory of fixed asset utilization, dropping from 2.01 in 2019 to a low of 1.25 in 2020. Efficiency improved steadily thereafter, peaking at 2.89 in 2022 before settling at 2.30 in 2023. This indicates a period of intensified asset productivity relative to revenue generation during the 2021-2022 window.
- Equity Productivity
- Equity turnover displayed the highest degree of volatility among the activity ratios. After declining from 4.97 in 2019 to 3.45 in 2020, it surged to 6.18 in 2021 and reached a maximum of 7.49 in 2022. The ratio decreased to 5.49 in 2023. The substantial peak in 2022 suggests a highly efficient use of shareholders' equity to generate sales during that fiscal year.
The convergence of these trends indicates that 2022 represented a period of peak operational efficiency regarding long-term investments. While 2023 shows a downward adjustment from those peaks, the activity ratios for fixed assets, total assets, and equity all remain above their respective 2019 and 2020 levels, suggesting an overall improvement in asset productivity over the five-year horizon.
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Net Fixed Asset Turnover
Valero Energy Corp., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues, includes excise taxes on sales by certain of foreign operations | 144,766) | 176,383) | 113,977) | 64,912) | 108,324) | |
| Property, plant, and equipment, net | 30,209) | 30,978) | 30,847) | 30,389) | 29,264) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | 4.79 | 5.69 | 3.69 | 2.14 | 3.70 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Chevron Corp. | 1.28 | 1.64 | 1.06 | — | — | |
| ConocoPhillips | 0.80 | 1.21 | 0.71 | — | — | |
| Exxon Mobil Corp. | 1.56 | 1.95 | 1.28 | — | — | |
| Net Fixed Asset Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | 1.34 | 1.73 | 1.12 | — | — | |
| Net Fixed Asset Turnover, Industry | ||||||
| Energy | 1.39 | 1.77 | 1.15 | — | — | |
Based on: 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), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Net fixed asset turnover = Revenues, includes excise taxes on sales by certain of foreign operations ÷ Property, plant, and equipment, net
= 144,766 ÷ 30,209 = 4.79
2 Click competitor name to see calculations.
The analysis of investment activity from 2019 to 2023 reveals a period of significant revenue volatility coupled with a remarkably stable net fixed asset base. The efficiency of asset utilization, as measured by the net fixed asset turnover ratio, fluctuated in direct correlation with top-line performance.
- Revenue and Asset Base Trends
- Annual revenues exhibited extreme variance, decreasing from US$ 108,324 million in 2019 to US$ 64,912 million in 2020, before climbing to a peak of US$ 176,383 million in 2022 and moderating to US$ 144,766 million in 2023. During this same interval, property, plant, and equipment, net, remained nearly constant, fluctuating within a narrow range between US$ 29,264 million and US$ 30,978 million. This suggests that fluctuations in revenue were driven by market conditions or pricing rather than significant changes in capital investment.
- Net Fixed Asset Turnover Performance
- The net fixed asset turnover ratio mirrored the trajectory of revenues throughout the period. A sharp decline was observed in 2020, where the ratio fell to 2.14, reflecting diminished revenue generation relative to the fixed asset base. A strong recovery followed, with the ratio returning to 3.69 in 2021 and reaching a five-year high of 5.69 in 2022. By 2023, the ratio adjusted to 4.79, consistent with the reduction in annual revenues.
- Operational Efficiency Insights
- The stability of the net fixed asset value indicates a mature infrastructure with minimal large-scale capital expansion or contraction over the five-year period. Consequently, the volatility in the turnover ratio serves as a primary indicator of external market-driven revenue shifts rather than changes in the company's internal asset intensity. The peak efficiency recorded in 2022 demonstrates a high capacity for revenue generation from the existing asset base during favorable economic conditions.
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Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
Valero Energy Corp., net fixed asset turnover (including operating lease, right-of-use asset) calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues, includes excise taxes on sales by certain of foreign operations | 144,766) | 176,383) | 113,977) | 64,912) | 108,324) | |
| Property, plant, and equipment, net | 30,209) | 30,978) | 30,847) | 30,389) | 29,264) | |
| Operating lease ROU assets, net | 1,136) | 1,114) | 1,284) | 1,204) | 1,329) | |
| Property, plant, and equipment, net (including operating lease, right-of-use asset) | 31,345) | 32,092) | 32,131) | 31,593) | 30,593) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover (including operating lease, right-of-use asset)1 | 4.62 | 5.50 | 3.55 | 2.05 | 3.54 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Competitors2 | ||||||
| Chevron Corp. | 1.24 | 1.59 | 1.03 | — | — | |
| ConocoPhillips | 0.79 | 1.20 | 0.70 | — | — | |
| Exxon Mobil Corp. | 1.51 | 1.89 | 1.24 | — | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Oil, Gas & Consumable Fuels | 1.30 | 1.68 | 1.09 | — | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Energy | 1.35 | 1.72 | 1.12 | — | — | |
Based on: 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), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Net fixed asset turnover (including operating lease, right-of-use asset) = Revenues, includes excise taxes on sales by certain of foreign operations ÷ Property, plant, and equipment, net (including operating lease, right-of-use asset)
= 144,766 ÷ 31,345 = 4.62
2 Click competitor name to see calculations.
The analysis of long-term investment activity reveals a period of significant volatility in revenue generation contrasted by a highly stable fixed asset base. The relationship between these two variables directly dictates the fluctuations in the net fixed asset turnover ratio from 2019 to 2023.
- Revenue Volatility and Asset Stability
- Revenues experienced a sharp contraction in 2020, falling to 64,912 million USD from 108,324 million USD in 2019. This was followed by a recovery in 2021 and a peak in 2022 at 176,383 million USD, before settling at 144,766 million USD in 2023. Throughout this period, net property, plant, and equipment, including right-of-use assets, remained remarkably consistent, fluctuating within a narrow range between 30,593 million USD and 32,131 million USD.
- Net Fixed Asset Turnover Trends
- The net fixed asset turnover ratio mirrored the revenue movements due to the static nature of the asset base. The ratio declined from 3.54 in 2019 to a low of 2.05 in 2020, reflecting a decrease in asset productivity during the revenue downturn. A recovery occurred in 2021, with the ratio returning to 3.55. The ratio reached a peak of 5.50 in 2022, indicating maximum revenue generation per unit of fixed asset, before moderating to 4.62 in 2023.
- Investment Efficiency Insights
- The observed trends indicate that the company did not significantly expand or contract its physical infrastructure in response to market volatility. The increase in turnover observed in 2022 and 2023 suggests an improvement in the utilization of existing assets or an increase in the market value of the outputs produced, rather than an increase in total productive capacity.
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Total Asset Turnover
Valero Energy Corp., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues, includes excise taxes on sales by certain of foreign operations | 144,766) | 176,383) | 113,977) | 64,912) | 108,324) | |
| Total assets | 63,056) | 60,982) | 57,888) | 51,774) | 53,864) | |
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | 2.30 | 2.89 | 1.97 | 1.25 | 2.01 | |
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Chevron Corp. | 0.75 | 0.91 | 0.65 | — | — | |
| ConocoPhillips | 0.59 | 0.84 | 0.51 | — | — | |
| Exxon Mobil Corp. | 0.89 | 1.08 | 0.82 | — | — | |
| Total Asset Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | 0.80 | 0.99 | 0.71 | — | — | |
| Total Asset Turnover, Industry | ||||||
| Energy | 0.79 | 0.97 | 0.71 | — | — | |
Based on: 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), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Total asset turnover = Revenues, includes excise taxes on sales by certain of foreign operations ÷ Total assets
= 144,766 ÷ 63,056 = 2.30
2 Click competitor name to see calculations.
An analysis of the efficiency ratios indicates significant volatility in asset utilization between 2019 and 2023, primarily driven by fluctuations in annual revenues rather than changes in the asset base. While the total asset base has grown steadily over the five-year period, the revenue generation capacity has experienced sharp contractions and expansions, leading to a non-linear trend in the total asset turnover ratio.
- Revenue Fluctuations
- Annual revenues exhibited a sharp decline in 2020, falling from 108,324 million USD to 64,912 million USD. This was followed by a strong recovery phase, with revenues increasing to 113,977 million USD in 2021 and reaching a peak of 176,383 million USD in 2022. A subsequent correction occurred in 2023, where revenues moderated to 144,766 million USD.
- Asset Base Evolution
- The total asset base remained relatively stable during the initial downturn, dipping slightly from 53,864 million USD in 2019 to 51,774 million USD in 2020. From 2021 onward, a consistent upward trend is observed, with assets increasing to 57,888 million USD, 60,982 million USD, and finally 63,056 million USD by the end of 2023. This represents a steady expansion of the company's resource base.
- Total Asset Turnover Analysis
- The total asset turnover ratio mirrored the volatility of revenues. A significant drop is noted in 2020, where the ratio fell to 1.25, indicating a temporary reduction in the efficiency of assets to generate sales. The ratio recovered to 1.97 in 2021 and surged to a five-year peak of 2.89 in 2022, reflecting a period of exceptionally high asset productivity. By 2023, the ratio settled at 2.30, which, despite being lower than the 2022 peak, remains above the 2019 baseline of 2.01.
The overall trend suggests that the organization has successfully expanded its asset base while improving its long-term revenue-generating efficiency. The period of 2022 represents a peak in operational leverage, while the 2023 figures indicate a normalization of turnover levels amidst continued asset growth.
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Equity Turnover
Valero Energy Corp., equity turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenues, includes excise taxes on sales by certain of foreign operations | 144,766) | 176,383) | 113,977) | 64,912) | 108,324) | |
| Total Valero Energy Corporation stockholders’ equity | 26,346) | 23,561) | 18,430) | 18,801) | 21,803) | |
| Long-term Activity Ratio | ||||||
| Equity turnover1 | 5.49 | 7.49 | 6.18 | 3.45 | 4.97 | |
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Chevron Corp. | 1.22 | 1.48 | 1.12 | — | — | |
| ConocoPhillips | 1.14 | 1.64 | 1.01 | — | — | |
| Exxon Mobil Corp. | 1.63 | 2.04 | 1.64 | — | — | |
| Equity Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | 1.42 | 1.77 | 1.35 | — | — | |
| Equity Turnover, Industry | ||||||
| Energy | 1.43 | 1.76 | 1.36 | — | — | |
Based on: 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), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Equity turnover = Revenues, includes excise taxes on sales by certain of foreign operations ÷ Total Valero Energy Corporation stockholders’ equity
= 144,766 ÷ 26,346 = 5.49
2 Click competitor name to see calculations.
The analysis of long-term investment activity reveals significant volatility in asset utilization efficiency between 2019 and 2023. The equity turnover ratio experienced a sharp decline during the initial period, followed by a period of rapid expansion and a subsequent normalization in the final year.
- Revenue Fluctuations
- Revenues exhibited a volatile trajectory, starting at 108,324 million USD in 2019 and dropping sharply to 64,912 million USD in 2020. A strong recovery followed, with revenues climbing to 113,977 million USD in 2021 and peaking at 176,383 million USD in 2022, before moderating to 144,766 million USD in 2023.
- Equity Position
- Total stockholders' equity showed a general upward trend over the five-year period, despite a temporary contraction between 2019 and 2021. After reaching a low of 18,430 million USD in 2021, equity grew consistently, ending the period at 26,346 million USD in 2023, representing a cumulative increase in the capital base.
- Equity Turnover Performance
- The equity turnover ratio, which measures the efficiency of generating revenue from shareholders' equity, decreased from 4.97 in 2019 to a low of 3.45 in 2020. This decline was primarily driven by the contraction in revenues. The ratio then increased significantly, reaching a peak of 7.49 in 2022, indicating a period of high operational leverage where revenue growth vastly outpaced the growth of the equity base.
- Recent Trends and Insights
- In 2023, the equity turnover ratio declined to 5.49. This reduction is attributable to the simultaneous occurrence of lower annual revenues compared to the previous year and a continued increase in total stockholders' equity. This suggests a normalization of revenue generation efficiency following the anomalous peak observed in 2022.
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