Chevron Corp (CVX)

Activity ratios

Short-term

Turnover ratios

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Inventory turnover	14.74	14.03	15.01	16.11	18.44	16.02	16.78	16.94	14.09	13.89	12.03	11.38	10.81	13.13	14.71	14.03	16.54	15.29	14.09	14.84
Receivables turnover	10.09	9.56	11.55	12.76	12.04	10.59	8.04	7.95	8.82	8.43	7.60	6.74	8.25	10.88	13.71	14.05	11.00	11.76	11.15	10.97
Payables turnover	6.21	6.11	7.40	8.29	8.02	6.65	5.20	5.49	5.82	5.56	5.10	4.98	5.60	7.82	9.82	8.38	6.86	6.88	6.48	7.01
Working capital turnover	22.65	24.82	17.21	16.60	15.26	16.27	17.90	13.68	23.39	20.09	24.73	32.25	24.31	20.59	40.41	436.75	81.44	40.62	37.67	44.03

Activity ratios provide insight into how effectively a company is managing its assets and liabilities to generate sales and revenue. Let's analyze Chevron Corp.'s activity ratios based on the provided data:

1. Inventory Turnover: Chevron Corp. has a relatively stable inventory turnover ratio over the quarters, ranging from 13.30 to 17.63. This indicates that Chevron is efficiently managing its inventory levels, with higher turnover ratios suggesting faster sales of inventory.

2. Receivables Turnover: The receivables turnover ratio reflects how quickly Chevron collects its accounts receivable. The company's receivables turnover has shown a fluctuating trend, ranging from 7.60 to 12.21. Higher turnover ratios suggest that Chevron is efficient in collecting payments from customers.

3. Payables Turnover: The payables turnover ratio measures how quickly Chevron pays its suppliers. The company's payables turnover has varied between 4.97 and 7.92. A higher turnover ratio indicates that Chevron is effectively managing its payables.

4. Working Capital Turnover: The working capital turnover ratio illustrates how efficiently Chevron is utilizing its working capital to generate revenue. The company's working capital turnover has fluctuated, ranging from 13.09 to 23.91. A higher turnover ratio indicates that Chevron is efficiently using its working capital to support sales activities.

Overall, Chevron Corp. demonstrates strong efficiency in managing its inventory, receivables, payables, and working capital, as indicated by its activity ratios. The company's ability to effectively manage these operational aspects contributes to its overall financial health and performance.

Average number of days

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Days of inventory on hand (DOH)	days	24.77	26.01	24.32	22.65	19.79	22.79	21.75	21.55	25.91	26.28	30.35	32.07	33.76	27.80	24.82	26.02	22.07	23.87	25.91	24.60
Days of sales outstanding (DSO)	days	36.18	38.18	31.59	28.61	30.32	34.47	45.39	45.93	41.38	43.32	48.04	54.12	44.22	33.54	26.63	25.98	33.20	31.03	32.73	33.27
Number of days of payables	days	58.74	59.73	49.33	44.03	45.49	54.92	70.22	66.51	62.74	65.64	71.60	73.36	65.13	46.67	37.15	43.56	53.22	53.06	56.34	52.06

Chevron Corp.'s activity ratios provide insights into the efficiency of its operations. The days of inventory on hand (DOH) have shown a slight increase over the quarters, indicating a longer period it takes to sell inventory. This could suggest potential issues with inventory management or changing market demand.

In contrast, the days of sales outstanding (DSO) have fluctuated but generally decreased, reflecting a quicker collection of accounts receivable. This trend implies an improvement in the company's credit policies or prompt customer payments, enhancing cash flow.

The number of days of payables has also varied, but on average, it has decreased. This implies that Chevron is taking longer to pay its suppliers, potentially benefiting from extended payment terms or negotiating better agreements.

Overall, analyzing these activity ratios suggests that Chevron Corp. has been working on optimizing its working capital management, particularly in terms of inventory, accounts receivable, and accounts payable turnover. It is essential for the company to maintain a balance between these ratios to ensure smooth operations and financial stability.

Long-term

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Fixed asset turnover	1.31	1.37	1.56	1.70	1.71	1.65	1.50	1.28	1.11	0.94	0.79	0.62	0.60	0.74	0.82	0.96	0.97	0.93	0.97	0.98
Total asset turnover	0.77	0.80	0.88	0.95	0.96	0.92	0.84	0.74	0.68	0.58	0.49	0.39	0.39	0.47	0.53	0.60	0.62	0.59	0.63	0.64

Chevron Corp.'s long-term activity ratios reflect the efficiency of the company in utilizing its fixed assets and total assets to generate revenues.

The fixed asset turnover ratio has shown a decreasing trend over the past two years, from 1.64 in Q4 2022 to 1.28 in Q4 2023. This indicates that Chevron is generating less revenue per dollar of investment in fixed assets. The declining trend might suggest that the company is not effectively utilizing its fixed assets or that its revenue generation from these assets is decreasing.

On the other hand, the total asset turnover ratio has also been decreasing, from 0.91 in Q4 2022 to 0.75 in Q4 2023. This ratio indicates how efficiently the company is using its total assets to generate revenue. The decreasing trend in this ratio may suggest that Chevron's overall efficiency in generating sales relative to its total assets has declined over the past year.

In summary, the declining trends in both fixed asset turnover and total asset turnover ratios for Chevron Corp. signal potential inefficiencies in asset utilization and revenue generation, which could impact the company's long-term financial performance. Further analysis and comparative assessment with industry peers may provide additional insights into the underlying factors driving these changes.