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)
Zoetis Inc., 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).
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio demonstrates a gradual decline over the analyzed period. It started at 3.23 in 2019, and despite a slight recovery in 2021 to 3.21, it decreased consistently thereafter, reaching 2.66 by 2023. This downward trend suggests a reduction in the efficiency with which the company utilizes its fixed assets to generate sales.
- Net Fixed Asset Turnover (including operating lease, right-of-use asset)
- This metric follows a pattern similar to the net fixed asset turnover, with figures consistently lower due to the inclusion of additional lease-related assets. Beginning at 2.94 in 2019, the ratio exhibits a modest increase in 2021 before declining steadily to 2.48 in 2023. The consistent decrease indicates diminishing asset utilization efficiency when considering the impact of leased assets.
- Total Asset Turnover
- The total asset turnover ratio shows some variability but an overall positive trend. Starting at 0.54 in 2019, it dipped to 0.49 in 2020, then recovered in subsequent years, reaching 0.6 in 2023. This improvement reflects enhanced overall asset efficiency in generating revenue, suggesting better management of the company's broader asset base.
- Equity Turnover
- Equity turnover reveals a noticeable decline from 2.31 in 2019 to 1.77 in 2020, with a further decrease to 1.71 in 2021. Although there was a slight rebound to 1.83 in 2022, the ratio fell again to 1.71 in 2023. This trend indicates a general reduction in the effectiveness of equity capital utilization for generating sales, with some minor fluctuations.
Net Fixed Asset Turnover
Zoetis Inc., 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) | ||||||
| Revenue | 8,544) | 8,080) | 7,776) | 6,675) | 6,260) | |
| Property, plant and equipment including finance lease right of use assets, less accumulated depreciation | 3,213) | 2,753) | 2,422) | 2,202) | 1,940) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | 2.66 | 2.93 | 3.21 | 3.03 | 3.23 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| AbbVie Inc. | 10.89 | 11.76 | 11.00 | 8.73 | — | |
| Amgen Inc. | 4.53 | 4.57 | 4.69 | 4.96 | — | |
| Bristol-Myers Squibb Co. | 6.77 | 7.38 | 7.67 | 7.22 | — | |
| Danaher Corp. | 5.25 | 7.96 | 7.77 | 6.83 | — | |
| Eli Lilly & Co. | 2.64 | 2.81 | 3.15 | 2.83 | — | |
| Gilead Sciences Inc. | 5.07 | 4.93 | 5.27 | 4.90 | — | |
| Johnson & Johnson | 4.28 | 4.79 | 4.95 | 4.40 | — | |
| Merck & Co. Inc. | 2.61 | 2.77 | 2.53 | 2.67 | — | |
| Pfizer Inc. | 3.14 | 6.22 | 5.52 | 3.07 | — | |
| Regeneron Pharmaceuticals Inc. | 3.16 | 3.23 | 4.62 | 2.64 | — | |
| Thermo Fisher Scientific Inc. | 4.54 | 4.84 | 4.71 | 5.45 | — | |
| Vertex Pharmaceuticals Inc. | 8.51 | 8.06 | 6.92 | 6.47 | — | |
| Net Fixed Asset Turnover, Sector | ||||||
| Pharmaceuticals, Biotechnology & Life Sciences | 4.12 | 4.98 | 4.98 | 4.31 | — | |
| Net Fixed Asset Turnover, Industry | ||||||
| Health Care | 8.80 | 9.32 | 9.09 | 8.34 | — | |
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 = Revenue ÷ Property, plant and equipment including finance lease right of use assets, less accumulated depreciation
= 8,544 ÷ 3,213 = 2.66
2 Click competitor name to see calculations.
- Revenue
- The revenue exhibits a consistent upward trend over the five-year period. Starting at 6,260 million US dollars in 2019, it increased each year, reaching 8,544 million US dollars in 2023. The company’s revenue growth appears steady, with the most significant gains occurring between 2020 and 2021, and maintaining positive momentum thereafter.
- Property, Plant and Equipment, Net
- The net value of property, plant, and equipment, including finance lease right of use assets and accounting for depreciation, shows a persistent increase throughout the period. Beginning at 1,940 million US dollars in 2019, this asset base expanded to 3,213 million US dollars by 2023. This indicates ongoing investment in fixed assets or capital expenditures during these years.
- Net Fixed Asset Turnover
- The net fixed asset turnover ratio, reflecting the efficiency of the company’s use of fixed assets to generate revenue, shows a gradual decline from 3.23 in 2019 to 2.66 in 2023. Despite some fluctuations, the general downward trend suggests that revenue growth is not keeping pace proportionally with the increase in net fixed assets, implying a reduction in asset utilization efficiency over time.
Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
Zoetis Inc., 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) | ||||||
| Revenue | 8,544) | 8,080) | 7,776) | 6,675) | 6,260) | |
| Property, plant and equipment including finance lease right of use assets, less accumulated depreciation | 3,213) | 2,753) | 2,422) | 2,202) | 1,940) | |
| Operating lease right of use assets | 230) | 220) | 181) | 192) | 189) | |
| Property, plant and equipment including finance lease right of use assets, less accumulated depreciation (including operating lease, right-of-use asset) | 3,443) | 2,973) | 2,603) | 2,394) | 2,129) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover (including operating lease, right-of-use asset)1 | 2.48 | 2.72 | 2.99 | 2.79 | 2.94 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Competitors2 | ||||||
| AbbVie Inc. | 9.47 | 10.24 | 9.57 | 7.46 | — | |
| Amgen Inc. | 4.08 | 4.13 | 4.23 | 4.58 | — | |
| Bristol-Myers Squibb Co. | 5.60 | 6.18 | 6.66 | 6.30 | — | |
| Danaher Corp. | 4.26 | 6.35 | 6.10 | 5.30 | — | |
| Eli Lilly & Co. | 2.45 | 2.63 | 2.93 | 2.63 | — | |
| Gilead Sciences Inc. | 4.57 | 4.51 | 4.77 | 4.34 | — | |
| Johnson & Johnson | 4.07 | 4.54 | 4.72 | 4.18 | — | |
| Merck & Co. Inc. | 2.45 | 2.60 | 2.33 | 2.43 | — | |
| Pfizer Inc. | 2.72 | 5.25 | 4.64 | 2.79 | — | |
| Regeneron Pharmaceuticals Inc. | 3.11 | 3.17 | 4.52 | 2.58 | — | |
| Thermo Fisher Scientific Inc. | 3.89 | 4.13 | 3.98 | 4.82 | — | |
| Vertex Pharmaceuticals Inc. | 6.79 | 6.13 | 5.32 | 4.83 | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Sector | ||||||
| Pharmaceuticals, Biotechnology & Life Sciences | 3.71 | 4.48 | 4.45 | 3.91 | — | |
| Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset), Industry | ||||||
| Health Care | 7.17 | 7.48 | 7.17 | 6.51 | — | |
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) = Revenue ÷ Property, plant and equipment including finance lease right of use assets, less accumulated depreciation (including operating lease, right-of-use asset)
= 8,544 ÷ 3,443 = 2.48
2 Click competitor name to see calculations.
The financial data indicates a consistent upward trend in revenue over the five-year period, increasing from 6,260 million US dollars in 2019 to 8,544 million US dollars in 2023. This reflects a steady growth trajectory with an overall increase of approximately 36.5% from the beginning to the end of the period.
Concurrently, the net value of property, plant, and equipment (including various lease assets) also exhibits a steady increase. Starting at 2,129 million US dollars in 2019, it rises progressively each year, reaching 3,443 million US dollars by 2023. This represents an increase of about 61.7%, indicating substantial investments in fixed assets throughout the period.
Despite these investments and revenue growth, the net fixed asset turnover ratio, which measures the efficiency of fixed assets in generating revenue, shows a declining trend. The ratio decreases from 2.94 in 2019 to 2.48 in 2023. While there was some fluctuation in the middle years—peaking briefly in 2021 at 2.99—the overall pattern indicates a reduction in the efficiency with which fixed assets are utilized to generate revenue.
In summary, the company has experienced growth in both revenue and asset base, but the declining fixed asset turnover ratio suggests that asset utilization efficiency has diminished over the observed period. This could imply either increasing investments in assets that have not yet translated to proportional revenue growth or potentially less effective use of existing assets relative to revenue generation.
- Revenue Growth
- Steady increase from 6,260 million US dollars in 2019 to 8,544 million US dollars in 2023.
- Property, Plant, and Equipment
- Continuous investment with net fixed assets increasing from 2,129 million US dollars to 3,443 million US dollars.
- Net Fixed Asset Turnover Ratio
- Declined from 2.94 to 2.48, indicating decreasing asset efficiency despite revenue growth.
Total Asset Turnover
Zoetis Inc., 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) | ||||||
| Revenue | 8,544) | 8,080) | 7,776) | 6,675) | 6,260) | |
| Total assets | 14,286) | 14,925) | 13,900) | 13,609) | 11,545) | |
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | 0.60 | 0.54 | 0.56 | 0.49 | 0.54 | |
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| AbbVie Inc. | 0.40 | 0.42 | 0.38 | 0.30 | — | |
| Amgen Inc. | 0.28 | 0.38 | 0.40 | 0.39 | — | |
| Bristol-Myers Squibb Co. | 0.47 | 0.48 | 0.42 | 0.36 | — | |
| Danaher Corp. | 0.28 | 0.37 | 0.35 | 0.29 | — | |
| Eli Lilly & Co. | 0.53 | 0.58 | 0.58 | 0.53 | — | |
| Gilead Sciences Inc. | 0.43 | 0.43 | 0.40 | 0.36 | — | |
| Johnson & Johnson | 0.51 | 0.51 | 0.52 | 0.47 | — | |
| Merck & Co. Inc. | 0.56 | 0.54 | 0.46 | 0.52 | — | |
| Pfizer Inc. | 0.26 | 0.51 | 0.45 | 0.28 | — | |
| Regeneron Pharmaceuticals Inc. | 0.40 | 0.42 | 0.63 | 0.50 | — | |
| Thermo Fisher Scientific Inc. | 0.43 | 0.46 | 0.41 | 0.47 | — | |
| Vertex Pharmaceuticals Inc. | 0.43 | 0.49 | 0.56 | 0.53 | — | |
| Total Asset Turnover, Sector | ||||||
| Pharmaceuticals, Biotechnology & Life Sciences | 0.40 | 0.47 | 0.45 | 0.39 | — | |
| Total Asset Turnover, Industry | ||||||
| Health Care | 0.73 | 0.75 | 0.70 | 0.64 | — | |
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 = Revenue ÷ Total assets
= 8,544 ÷ 14,286 = 0.60
2 Click competitor name to see calculations.
The financial data reveals several trends in the company's performance over the five-year period ending in 2023. Revenue demonstrated consistent growth year over year, increasing from $6,260 million in 2019 to $8,544 million in 2023. This steady rise indicates expanding operations or stronger sales performance throughout the timeframe.
Total assets also presented an overall upward trajectory, starting at $11,545 million in 2019 and peaking at $14,925 million in 2022 before slightly declining to $14,286 million in 2023. This suggests continued investment in assets or acquisitions until 2022, followed by a modest reduction or revaluation of asset base in the most recent year.
The total asset turnover ratio, which measures the efficiency of asset use in generating revenue, exhibited variability but remained relatively stable. It decreased from 0.54 in 2019 to 0.49 in 2020, indicating a temporary dip in asset efficiency. However, it improved to 0.56 in 2021, returned to 0.54 in 2022, and reached the highest value of 0.60 in 2023. This trend implies progressive improvements in how effectively assets are utilized, especially notable in the last year, reflecting enhanced operational efficiency or optimized asset management.
- Revenue
- Consistent growth from $6,260 million in 2019 to $8,544 million in 2023, indicating expanding business activities or market presence.
- Total assets
- General upward trend from $11,545 million to a peak of $14,925 million in 2022, followed by a slight decrease to $14,286 million in 2023, suggesting ongoing investment with recent stabilization or divestiture.
- Total asset turnover
- Fluctuated between 0.49 and 0.60, with an initial drop in 2020, recovery thereafter, and highest efficiency in 2023, signifying enhanced effectiveness in asset utilization over time.
Equity Turnover
Zoetis Inc., equity turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue | 8,544) | 8,080) | 7,776) | 6,675) | 6,260) | |
| Total Zoetis Inc. equity | 4,997) | 4,405) | 4,543) | 3,769) | 2,708) | |
| Long-term Activity Ratio | ||||||
| Equity turnover1 | 1.71 | 1.83 | 1.71 | 1.77 | 2.31 | |
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| AbbVie Inc. | 5.24 | 3.36 | 3.65 | 3.50 | — | |
| Amgen Inc. | 4.32 | 6.77 | 3.63 | 2.58 | — | |
| Bristol-Myers Squibb Co. | 1.53 | 1.49 | 1.29 | 1.12 | — | |
| Danaher Corp. | 0.45 | 0.63 | 0.65 | 0.56 | — | |
| Eli Lilly & Co. | 3.17 | 2.68 | 3.15 | 4.35 | — | |
| Gilead Sciences Inc. | 1.18 | 1.27 | 1.28 | 1.34 | — | |
| Johnson & Johnson | 1.24 | 1.24 | 1.27 | 1.31 | — | |
| Merck & Co. Inc. | 1.60 | 1.29 | 1.28 | 1.90 | — | |
| Pfizer Inc. | 0.67 | 1.06 | 1.06 | 0.67 | — | |
| Regeneron Pharmaceuticals Inc. | 0.51 | 0.54 | 0.86 | 0.77 | — | |
| Thermo Fisher Scientific Inc. | 0.92 | 1.02 | 0.96 | 0.93 | — | |
| Vertex Pharmaceuticals Inc. | 0.56 | 0.64 | 0.75 | 0.71 | — | |
| Equity Turnover, Sector | ||||||
| Pharmaceuticals, Biotechnology & Life Sciences | 1.15 | 1.24 | 1.27 | 1.22 | — | |
| Equity Turnover, Industry | ||||||
| Health Care | 2.00 | 1.97 | 1.91 | 1.89 | — | |
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 = Revenue ÷ Total Zoetis Inc. equity
= 8,544 ÷ 4,997 = 1.71
2 Click competitor name to see calculations.
The financial data reveals several trends over the period from 2019 to 2023. Revenue has shown a steady increase each year, rising from $6,260 million in 2019 to $8,544 million in 2023. This indicates consistent growth in sales or service income across the five-year span.
Total equity has also generally increased, growing from $2,708 million in 2019 to $4,997 million in 2023, with a slight dip observed in 2022 compared to 2021. This suggests an overall strengthening of the company's capital base, despite the minor decrease in that year.
The equity turnover ratio, which measures the efficiency with which the company uses its equity to generate revenue, exhibits a decline from 2.31 in 2019 to 1.71 in 2023. After a sharper decrease between 2019 and 2021, the ratio slightly rebounded in 2022 before falling again in 2023. This decreasing trend may imply that although revenue is growing, the company's equity base is expanding at a faster pace, potentially reducing the efficiency of equity utilization over the period.
- Revenue
- Consistent upward trend increasing annually from $6,260 million in 2019 to $8,544 million in 2023.
- Total Equity
- Overall growth from $2,708 million in 2019 to $4,997 million in 2023, with a slight decrease in 2022.
- Equity Turnover Ratio
- Decreasing trend from 2.31 in 2019 to 1.71 in 2023, indicating declining efficiency in using equity to generate revenue.