Analysis of Long-term (Investment) Activity Ratios
Quarterly Data
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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- Balance Sheet: Assets
- Common-Size Income Statement
- Common-Size Balance Sheet: Assets
- Analysis of Profitability Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Enterprise Value (EV)
- Enterprise Value to EBITDA (EV/EBITDA)
- Dividend Discount Model (DDM)
- Selected Financial Data since 2005
- Net Profit Margin since 2005
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Long-term Activity Ratios (Summary)
Waste Management Inc., long-term (investment) activity ratios (quarterly data)
Based on: 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31).
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio remained relatively stable between March 2017 and December 2019, fluctuating slightly around the 1.20 to 1.26 range. Starting from March 2020, there was a noticeable decline, reaching a low of 1.08 in the first quarter of 2021. However, a recovery is observed in the subsequent quarters of 2021, with the ratio increasing back to 1.24 by December 2021. This pattern suggests some temporary challenges in the efficient utilization of fixed assets during 2020, followed by a gradual improvement towards the end of 2021.
- Total Asset Turnover
- The total asset turnover ratio exhibited a gradual decline from 0.66 in early 2017 through to a low of 0.52 in March 2021. After this trough, a progressive improvement is evident, with the ratio rising to 0.62 by December 2021. This trend indicates a reduction in asset utilization efficiency over the initial years, potentially due to asset base expansion or lower sales, followed by a partial recovery in asset productivity towards the end of the observed period.
- Equity Turnover
- The equity turnover ratio shows a downward trend from 2.41 in early 2017 to a low of 2.04 in March 2021. From mid-2021 onwards, the ratio increased steadily, reaching 2.52 by December 2021. This pattern suggests fluctuations in the efficiency with which the company employs shareholders’ equity to generate sales, with a period of diminishing returns until early 2021, followed by a notable rebound in the later quarters of 2021.
- Overall Analysis
- Across all three turnover ratios, the data reveals a period of relative stability and minor declines until early 2020, followed by more pronounced decreases in 2020 and early 2021. This may reflect adverse conditions impacting asset and equity utilization during this period. From mid-2021 onwards, all ratios demonstrate recovery trends, suggesting improvements in operational efficiency and asset management in the later part of the timeline.
Net Fixed Asset Turnover
Waste Management Inc., net fixed asset turnover calculation (quarterly data)
Based on: 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31).
1 Q4 2021 Calculation
Net fixed asset turnover
= (Operating revenuesQ4 2021
+ Operating revenuesQ3 2021
+ Operating revenuesQ2 2021
+ Operating revenuesQ1 2021)
÷ Property and equipment, net of accumulated depreciation and amortization
= ( + + + )
÷ =
- Operating Revenues
- Operating revenues exhibit a generally upward trend over the periods analyzed, rising from $3,440 million in March 2017 to $4,678 million by December 2021. Some fluctuations are noticeable, such as a slight decline in early 2020, likely impacted by external factors, followed by a recovery that continues through 2021. The revenue increases appear relatively steady, with the highest quarterly revenue recorded in the last quarter of 2021.
- Property and Equipment, Net of Accumulated Depreciation and Amortization
- The net value of property and equipment shows consistent growth from $10,929 million at the beginning of 2017 to $14,419 million by the end of 2021. This indicates ongoing or sustained capital investment in fixed assets. The growth is gradual with occasional periods of minor stagnation or slight declines, but the overall trend is upward, suggesting a focus on asset base expansion or renewal over the observed timeframe.
- Net Fixed Asset Turnover Ratio
- The net fixed asset turnover ratio remains relatively stable around 1.2 in 2017 and 2018 but demonstrates a gradual decline starting in 2019 through mid-2020, reaching its lowest point near 1.08 in the first half of 2021. After this low, the ratio recovers moderately toward the end of 2021, reaching approximately 1.24. This pattern suggests that for a period, the efficiency with which fixed assets generate revenue diminished, possibly due to increased asset base without proportional revenue increases, before improving again in the latter part of the analysis period.
- Overall Insights
- The company shows steady revenue growth alongside continuous investment in property and equipment. Despite this, there is a period where net fixed asset turnover decreases, indicating some lag in revenue generation relative to asset growth. The recovery in asset turnover ratio in late 2021 points to improved utilization of fixed assets. These trends collectively suggest a phase of asset accumulation followed by enhanced operational efficiency.
Total Asset Turnover
Waste Management Inc., total asset turnover calculation (quarterly data)
Based on: 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31).
1 Q4 2021 Calculation
Total asset turnover
= (Operating revenuesQ4 2021
+ Operating revenuesQ3 2021
+ Operating revenuesQ2 2021
+ Operating revenuesQ1 2021)
÷ Total assets
= ( + + + )
÷ =
The analysis of the quarterly financial data over the observed periods reveals several notable trends and changes in key financial metrics.
- Operating Revenues
- Operating revenues exhibit a generally upward trajectory with fluctuations across the quarters. From March 2017 to December 2019, revenues increased from approximately 3,440 million USD to 3,846 million USD, showing steady growth. However, there was a decline in early 2020, likely corresponding with broader market disruptions, with revenues dropping to 3,561 million USD in June 2020. Post this decline, a significant recovery and growth phase is observed, with revenues rising sharply to 4,678 million USD by December 2021. This pattern suggests resilience and an effective revenue recovery strategy in recent periods.
- Total Assets
- Total assets generally increased over the period but with some volatility. Starting at approximately 20,650 million USD in March 2017, assets peaked at around 27,743 million USD by December 2019. Following this peak, a reduction occurred through most of 2020 down to about 24,772 million USD by September 2020. Interestingly, there was a rebound in the later part of 2020 and stability thereafter, with total assets maintaining just under 29,100 million USD through the end of 2021. These fluctuations may reflect investment cycles, asset disposals, or market conditions influencing the asset base.
- Total Asset Turnover
- The total asset turnover ratio, available starting from the third quarter of 2017, showed a declining trend from 0.66 to a low of approximately 0.52 in June 2021, indicating a decreased efficiency in using assets to generate revenues during this period. However, this downward trend reversed towards the end of 2021, with the ratio improving to 0.62 by December 2021. This improvement suggests enhanced operational efficiency or better asset utilization in the most recent quarters.
In summary, while the company faced some revenue and asset challenges around 2020, it demonstrated considerable recovery and growth in both revenues and asset base thereafter. The efficiency of asset use dipped mid-period but showed signs of improvement towards the end. These dynamics suggest a period of adjustment followed by successful recovery efforts and potentially optimized asset management practices.
Equity Turnover
Waste Management Inc., equity turnover calculation (quarterly data)
Based on: 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31).
1 Q4 2021 Calculation
Equity turnover
= (Operating revenuesQ4 2021
+ Operating revenuesQ3 2021
+ Operating revenuesQ2 2021
+ Operating revenuesQ1 2021)
÷ Total Waste Management, Inc. stockholders’ equity
= ( + + + )
÷ =
- Operating Revenues
- The operating revenues exhibit a generally increasing trend over the period analyzed. Starting at 3,440 million US dollars in the first quarter of 2017, revenues increased steadily with some fluctuations, reaching a peak of 4,678 million US dollars in the last quarter of 2021. There is a noticeable dip in revenues during the first half of 2020, corresponding likely to external economic impacts, followed by a strong recovery and continued growth through 2021. The overall trend indicates growth and resilience in the revenue stream over these five years.
- Total Stockholders' Equity
- Stockholders' equity shows a more volatile pattern compared to revenues. Initially declining from 5,517 million US dollars in early 2017 to 5,278 million in the third quarter of 2017, equity then rebounds to exceed 7,068 million by the end of 2019. The first half of 2020 sees a decrease again, potentially reflecting market or operational pressures during that period. Post mid-2020, equity values stabilize between 7,124 million and 7,427 million, displaying relative stability but no strong upward momentum through the end of 2021.
- Equity Turnover
- Equity turnover ratio, available from the third quarter of 2017 onward, generally trends downward from 2.41 to a low of 2.04 in mid-2020, indicating a decline in the efficiency with which the company uses its equity to generate revenue during that period. However, from late 2020 through 2021, the ratio recovers impressively, reaching 2.52 by the last quarter of 2021, which exceeds earlier levels. This suggests an improvement in operational efficiency and revenue generation relative to equity invested in the most recent periods.
- Summary of Trends
- In summary, the financial data reveal a growth in operating revenues with some disruption and recovery around 2020, likely due to external factors affecting the business environment. Stockholders' equity experienced fluctuations, showing a recovery phase followed by stabilization but lacking strong growth momentum post-2019. The equity turnover ratio's decline and subsequent recovery reflect changing operational efficiency, with improved utilization of equity capital towards the end of the period. These patterns suggest resilience and the ability to adapt, with improving profitability metrics in the latter periods analyzed.