The Boeing Company (BA)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 6.93 | 6.53 | 5.53 | 5.52 | 6.80 |
| Receivables turnover | 29.37 | 26.46 | 23.58 | 29.75 | 23.44 |
| Payables turnover | 5.86 | 6.18 | 6.40 | 4.94 | 4.64 |
| Working capital turnover | 5.78 | 3.42 | 2.34 | 1.69 | 15.57 |
Boeing Co.'s activity ratios provide insights into the efficiency of the company's operations.
Inventory turnover measures how effectively the company manages its inventory. Boeing's inventory turnover has fluctuated over the past five years, with a slight increase from 0.81 in 2022 to 0.88 in 2023. This indicates that Boeing is slightly improving its inventory management efficiency.
Receivables turnover reflects how quickly the company collects its receivables. Boeing's receivables turnover has generally increased over the years, from 5.22 in 2019 to 7.09 in 2023, indicating that Boeing is collecting its receivables at a faster pace.
Payables turnover measures how efficiently the company pays its suppliers. Boeing's payables turnover fluctuated during the period, with a decrease from 6.40 in 2021 to 5.86 in 2023. This indicates that Boeing is taking longer to pay its suppliers, which could impact its relationship with them.
Working capital turnover shows how efficiently the company utilizes its working capital to generate sales. Boeing's working capital turnover has also fluctuated significantly, from 26.70 in 2019 to 2.48 in 2021, and a notable increase to 5.79 in 2023. This signifies that Boeing has been more efficient in using its working capital to generate sales in 2023 compared to previous years.
Overall, Boeing's activity ratios reflect mixed performance in terms of inventory management, accounts receivable collection, and payables management. However, the improvement in working capital turnover indicates better efficiency in utilizing its working capital to generate sales.
Average number of days
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 52.67 | 55.87 | 66.00 | 66.10 | 53.70 |
| Days of sales outstanding (DSO) | days | 12.43 | 13.79 | 15.48 | 12.27 | 15.57 |
| Number of days of payables | days | 62.32 | 59.02 | 57.03 | 73.91 | 78.74 |
To analyze Boeing Co.'s activity ratios, we will look at three key metrics: Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Number of Days of Payables.
The Days of Inventory on Hand measure the average number of days it takes for the company to sell its inventory. A decreasing trend from 2019 to 2023 is observed, indicating that Boeing has been more efficient in managing its inventory.
The Days of Sales Outstanding indicate the average number of days it takes for the company to collect payment after a sale is made. The decreasing trend in DSO from 2019 to 2023 suggests that Boeing has improved its collection process, resulting in quicker cash conversion from sales.
The Number of Days of Payables reflects the average number of days it takes for the company to pay its suppliers. The decreasing trend in payables days from 2019 to 2023 implies that Boeing has become more efficient in managing its payables, potentially improving its working capital management.
Overall, Boeing Co. has shown improvements in its activity ratios, signaling increased efficiency in managing inventory, collecting sales, and paying its suppliers. This indicates positive trends in the company's working capital management and operational performance.
See also:
The Boeing Company Short-term (Operating) Activity Ratios
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 7.30 | 6.31 | 5.70 | 4.92 | 6.12 |
| Total asset turnover | 0.57 | 0.49 | 0.45 | 0.38 | 0.57 |
The long-term activity ratios of Boeing Co., as indicated by the fixed asset turnover and total asset turnover, have exhibited fluctuating trends over the past five years. The fixed asset turnover ratio, which measures the efficiency of the company's use of fixed assets to generate sales, has shown an overall increasing trend, indicating improved utilization of fixed assets for revenue generation. This suggests that Boeing's investments in long-term assets have been increasingly productive over the years.
In contrast, the total asset turnover ratio, which reflects the company's efficiency in using all its assets to generate sales, has demonstrated a more volatile pattern. It has fluctuated over the period, with a downtrend from 2020 to 2021 followed by a partial recovery in 2022 and 2023. This may indicate varied performance in leveraging its total assets to generate sales during this time frame.
Overall, the analysis suggests that Boeing Co. has experienced improvements in the utilization of its fixed assets to generate sales, while the efficiency of using total assets for revenue generation has presented a more mixed performance, warranting further investigation into the factors driving these fluctuations.