Switch to:
Analog Devices Inc  (NAS:ADI) Asset Turnover: 0.07 (As of Oct. 2017)

Asset Turnover measures how quickly a company turns over its asset through sales. It is calculated as Revenue divided by Total Assets. Analog Devices Inc's Revenue for the three months ended in Oct. 2017 was \$1,541 Mil. Analog Devices Inc's Total Assets for the quarter that ended in Oct. 2017 was \$21,128 Mil. Therefore, Analog Devices Inc's asset turnover for the quarter that ended in Oct. 2017 was 0.07.

Asset Turnover is linked to ROE % through Du Pont Formula. Analog Devices Inc's annualized ROE % for the quarter that ended in Oct. 2017 was 13.85%. It is also linked to ROA % through Du Pont Formula. Analog Devices Inc's annualized ROA % for the quarter that ended in Oct. 2017 was 6.58%.

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Analog Devices Inc Annual Data

 Oct08 Oct09 Oct10 Oct11 Oct12 Oct13 Oct14 Oct15 Oct16 Oct17 Asset Turnover 0.44 0.43 0.49 0.46 0.35

Analog Devices Inc Quarterly Data

 Jan13 Apr13 Jul13 Oct13 Jan14 Apr14 Jul14 Oct14 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 Jan17 Apr17 Jul17 Oct17 Asset Turnover 0.13 0.11 0.06 0.06 0.07

Calculation

Asset Turnover measures how quickly a company turns over its asset through sales.

Analog Devices Inc's Asset Turnover for the fiscal year that ended in Oct. 2017 is calculated as

 Asset Turnover = Sales / Average Total Assets = Revenue (A: Oct. 2017 ) / ( (Total Assets (A: Oct. 2016 ) + Total Assets (A: Oct. 2017 )) / 2 ) = 5107.503 / ( (7970.278 + 21141.294) / 2 ) = 5107.503 / 14555.786 = 0.35

Analog Devices Inc's Asset Turnover for the quarter that ended in Oct. 2017 is calculated as

 Asset Turnover = Sales / Average Total Assets = Revenue (Q: Oct. 2017 ) / ( (Total Assets (Q: Jul. 2017 ) + Total Assets (Q: Oct. 2017 )) / 2 ) = 1541.17 / ( (21114.995 + 21141.294) / 2 ) = 1541.17 / 21128.1445 = 0.07

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Companies with low profit margins tend to have high asset turnover, while those with high profit margins have low asset turnover. Companies in the retail industry tend to have a very high turnover ratio.

Explanation

Asset Turnover is linked to Return on Equity (ROE) through Du Pont Formula.

Analog Devices Inc's annulized ROE % for the quarter that ended in Oct. 2017 is

 ROE % (Q: Oct. 2017 ) = Net Income / Total Equity = 1390.6 / 10042.22 = (Net Income / Revenue) * (Revenue / Total Assets) * (Total Assets / Total Equity) = (1390.6 / 6164.68) * (6164.68 / 21128.1445) * (21128.1445/ 10042.22) = Net Margin % * Asset Turnover * Leverage Ratio = 22.56 % * 0.2918 * 2.1039 = ROA % * Leverage Ratio = 6.58 % * 2.1039 = 13.85 %

Note: The Net Income data used here is four times the quarterly (Oct. 2017) net income data. The Revenue data used here is four times the quarterly (Oct. 2017) revenue data.

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

It is also linked to Return on Assets (ROA) through Du Pont Formula:

Analog Devices Inc's annulized ROA % for the quarter that ended in Oct. 2017 is

 ROA % (Q: Oct. 2017 ) = Net Income / Total Assets = 1390.6 / 21128.1445 = (Net Income / Revenue) * (Revenue / Total Assets) = (1390.6 / 6164.68) * (6164.68 / 21128.1445) = Net Margin % * Asset Turnover = 22.56 % * 0.2918 = 6.58 %

Note: The Net Income data used here is four times the quarterly (Oct. 2017) net income data. The Revenue data used here is four times the quarterly (Oct. 2017) revenue data.

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Be Aware

In the article Joining The Dark Side: Pirates, Spies and Short Sellers, James Montier reported that In their US sample covering the period 1968-2003, Cooper et al find that firms with low asset growth outperformed firms with high asset growth by an astounding 20% p.a. equally weighted. Even when controlling for market, size and style, low asset growth firms outperformed high asset growth firms by 13% p.a. Therefore a company with fast asset growth may underperform.

Therefore, it is a good sign if a company's asset turnover is consistent or even increases. If a company's asset grows faster than sales, its asset turnover will decline, which can be a warning sign.

Related Terms

From the Internet

###### Workday Inks Deal With Duo to Enhance its User Interface

- Zacks 2018-01-18 08:42:00

###### Itron (ITRI) Prices \$100M Senior Notes Offering Due 2026

- Zacks 2018-01-18 08:05:00

###### Amazon Takes Echo & Music Service to Australia, New Zealand

- Zacks 2018-01-18 07:59:00

###### Coupa (COUP) Closes Senior Note Offering Worth \$200 Million

- Zacks 2018-01-18 06:41:00

- Zacks 2018-01-18 06:16:00

###### Bull trend intact, U.S. benchmarks absorb (fleeting) shot across the bow

- MarketWatch 2018-01-17 12:10:00

###### IBM, Maersk Partner to Bring Blockchain-Based Trade Platform

- Zacks 2018-01-17 08:49:00

###### Nutanix Plans Senior Notes Offering Due to Mature in 2023

- Zacks 2018-01-17 08:47:00

Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to \$400 per referral. ( Learn More)