United Parcel Service Inc (UPS)
Total asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 90,120,000 | 99,706,000 | 96,557,000 | 83,936,000 | 73,435,000 |
| Total assets | US$ in thousands | 70,857,000 | 71,124,000 | 69,405,000 | 62,408,000 | 57,857,000 |
| Total asset turnover | 1.27 | 1.40 | 1.39 | 1.34 | 1.27 |
December 31, 2023 calculation
Total asset turnover = Revenue ÷ Total assets
= $90,120,000K ÷ $70,857,000K
= 1.27
Total asset turnover is a key financial ratio that measures a company's efficiency in generating sales revenue from its total assets. In the case of United Parcel Service, Inc., the total asset turnover ratio has fluctuated over the past five years.
In 2023, the total asset turnover ratio decreased to 1.28 from 1.41 in 2022, indicating a decline in the company's ability to generate sales from its total assets. This may suggest that UPS was less efficient in utilizing its assets to drive revenue in 2023 compared to the previous year.
However, when compared to 2021 and 2020 where the total asset turnover ratios were 1.40 and 1.36 respectively, the ratio of 1.28 in 2023 still indicates a relatively strong performance in asset utilization. This suggests that UPS has historically been effective in generating sales relative to its total asset base.
Furthermore, looking back to 2019, where the total asset turnover ratio was also 1.28, it appears that UPS has maintained a consistent level of asset utilization efficiency over the past five years overall.
Overall, while the decrease in total asset turnover from 2022 to 2023 may raise some concerns about efficiency, United Parcel Service, Inc. has historically demonstrated solid performance in generating sales revenue from its total assets.