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
- Analysis of Short-term (Operating) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Net Profit Margin since 2005
- Current Ratio since 2005
- Debt to Equity since 2005
- Total Asset Turnover since 2005
- Price to Book Value (P/BV) since 2005
- Price to Sales (P/S) since 2005
- Aggregate Accruals
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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).
The analysis of the quarterly financial ratios reveals distinct trends in asset utilization and equity turnover over the examined periods.
- Net Fixed Asset Turnover
- This ratio shows a generally stable performance between March 2018 and December 2019, fluctuating slightly around 1.20 to 1.26. From March 2020, a gradual decline is observable, reaching a low of 1.08 in December 2020. However, the ratio recovers progressively through 2021, climbing back to 1.24 by the end of the year, indicating improved efficiency in the use of net fixed assets after an interim decrease.
- Total Asset Turnover
- The total asset turnover ratio remains relatively consistent around 0.65 to 0.66 until March 2019. Afterwards, a noticeable downward trend occurs, bottoming out at 0.52 in December 2020. Starting in the first quarter of 2021, the ratio shows a steady recovery, rising to 0.62 by December 2021. This pattern suggests reduced efficiency in utilizing total assets during the mid-period, followed by a partial restoration of asset use efficiency.
- Equity Turnover
- The equity turnover ratio maintains values around 2.36 to 2.41 from March 2018 through March 2019, then demonstrates a gradual decline through December 2020, decreasing from approximately 2.35 to 2.04. After reaching this lower point, the ratio reverses course and improves steadily across 2021, peaking at 2.52 in the last quarter. This trend indicates a period of reduced effectiveness in generating revenue from equity, followed by enhanced turnover efficiency in the most recent quarters.
Overall, the data depicts an initial phase of stable asset and equity efficiency, followed by declines centered around late 2019 and 2020, likely reflecting broader economic or operational challenges. The subsequent recovery observed in 2021 across all three ratios highlights an improvement in the company's operational efficiency and asset utilization toward the end of the period analyzed.
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).
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
= ( + + + )
÷ =
The financial data over the observed periods reveals several key trends in the company's operational performance and asset utilization.
- Operating Revenues
- Operating revenues show a generally upward trajectory from March 2018 to December 2021, with some fluctuations. Revenues increased from approximately 3,511 million USD in March 2018 to 4,678 million USD in December 2021. The data shows a noticeable dip around the first half of 2020, coinciding with a decline from 3,846 million USD in December 2019 to 3,561 million USD in June 2020. However, this downturn was followed by a recovery and continued growth throughout the remainder of 2020 and into 2021, reaching new highs by the end of the period.
- Property and Equipment, Net of Accumulated Depreciation and Amortization
- The net value of property and equipment shows a steady increase over the entire period, starting at 11,637 million USD in March 2018 and rising to 14,419 million USD by December 2021. This gradual growth reflects consistent investment in fixed assets, with a particularly notable increase occurring in the latter part of 2020 and continuing through 2021, where values jumped from an average near 12,800 million USD to over 14,000 million USD. This suggests a strategic expansion or upgrade of the company’s physical assets.
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio exhibits a downward trend from 1.25 in March 2018 to a low of 1.08 in December 2020, indicating a reduction in efficiency in generating revenues from fixed assets during this time frame. However, a recovery is seen from 2021 onward, with the ratio improving to 1.24 by December 2021. This improvement in turnover ratio, alongside rising revenues, suggests enhanced operational efficiency or better asset management in the final periods of the data set.
In summary, the company demonstrates sustained growth in operating revenues and investment in property and equipment, despite a temporary revenue setback during the mid-2020 period. The fixed asset turnover ratio trends indicate an initial decline in asset utilization efficiency followed by a recovery, reflecting the company’s ability to adjust its operations to capitalize on its asset base more effectively in the later quarters.
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).
1 Q4 2021 Calculation
Total asset turnover
= (Operating revenuesQ4 2021
+ Operating revenuesQ3 2021
+ Operating revenuesQ2 2021
+ Operating revenuesQ1 2021)
÷ Total assets
= ( + + + )
÷ =
- Operating Revenues
- The operating revenues demonstrate a generally positive trend over the observed period. Starting at 3,511 million US dollars in March 2018, revenues increased gradually with minor fluctuations, reaching a peak of 4,678 million US dollars by December 2021. Notably, there was a dip during the first half of 2020, where revenues declined to 3,561 million US dollars in June 2020, potentially reflecting external economic impacts during that period. Subsequently, revenues exhibited a steady recovery and growth trend, with significant quarterly increases observed in 2021.
- Total Assets
- Total assets exhibited moderate growth overall from 22,106 million US dollars in March 2018 to 29,097 million US dollars by December 2021. There were fluctuations within this period, including a peak of 27,743 million US dollars in December 2019, followed by a decline to 24,772 million in September 2020. This drop was temporary, as assets increased again sharply by the end of 2020 and then stabilized around the 29,000 million mark through 2021. The data suggests fluctuations possibly linked to asset disposals or investments aligned with operational strategies.
- Total Asset Turnover
- The total asset turnover ratio, indicating the efficiency of assets in generating revenue, showed a declining trend from 0.66 in early 2018 to a low of 0.52 in December 2020. This decline implies a reduced efficiency in asset utilization over that period. However, starting in 2021, the ratio improved steadily, reaching 0.62 by the end of 2021. This recovery suggests enhanced operational efficiency or greater revenue generation relative to asset base during the latter part of the period analyzed.
- Overall Insights
- The analysis reveals a company experiencing growth in revenues alongside fluctuating asset levels, with asset efficiency waning initially but showing signs of recovery in recent quarters. The dip in revenues and assets around mid-2020 may indicate temporary challenges, potentially tied to broader economic conditions. The subsequent improvement in both revenues and asset turnover ratio indicates a positive adjustment in operational effectiveness and asset management strategies.
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).
1 Q4 2021 Calculation
Equity turnover
= (Operating revenuesQ4 2021
+ Operating revenuesQ3 2021
+ Operating revenuesQ2 2021
+ Operating revenuesQ1 2021)
÷ Total Waste Management, Inc. stockholders’ equity
= ( + + + )
÷ =
The quarterly financial data reveals several trends in key financial metrics over the observed periods.
- Operating Revenues
- Operating revenues showed an overall upward trend between March 2018 and December 2021. Initial values were at 3,511 million US dollars in the first quarter of 2018, gradually increasing with intermittent fluctuations. After a small dip during early 2020, revenues rebounded strongly, reaching a peak of 4,678 million US dollars by the last quarter of 2021. This suggests a recovery and growth phase following a mid-term contraction.
- Total Stockholders’ Equity
- Stockholders’ equity demonstrated a slow but steady increase from 6,044 million US dollars in March 2018 to a maximum of approximately 7,452 million US dollars by the end of 2020. However, in 2021, equity values slightly declined, ending at 7,124 million US dollars in the last quarter. This pattern reflects gradual value accumulation for shareholders over the long term, with a modest retracement in the final year observed.
- Equity Turnover Ratio
- The equity turnover ratio, indicating how efficiently equity is utilized to generate revenues, showed a general downward trend from 2.41 in early 2018 to a low of around 2.04 in late 2020. Notably, the ratio improved thereafter, increasing to 2.52 by the end of 2021. This suggests a decrease in efficiency in earlier periods, followed by a recovery in the capacity to generate sales per unit of equity.
In summary, the company experienced consistent growth in operating revenues with some volatility, alongside a gradual increase in equity that slightly reversed in the most recent year. Efficiency in equity utilization declined initially but improved towards the end, possibly reflecting strategic adjustments or changes in capital management effectiveness. The combination of these trends indicates resilience and positive momentum in the latter periods analyzed.