Switch to:
International Business Machines Corp  (NYSE:IBM) Asset Turnover: 0.16 (As of Jun. 2017)

Asset Turnover measures how quickly a company turns over its asset through sales. It is calculated as Revenue divided by Total Assets. International Business Machines Corp's Revenue for the three months ended in Jun. 2017 was $19,289 Mil. International Business Machines Corp's Total Assets for the quarter that ended in Jun. 2017 was $118,995 Mil. Therefore, International Business Machines Corp's asset turnover for the quarter that ended in Jun. 2017 was 0.16.

Asset Turnover is linked to ROE % through Du Pont Formula. International Business Machines Corp's annualized ROE % for the quarter that ended in Jun. 2017 was 50.75%. It is also linked to ROA % through Du Pont Formula. International Business Machines Corp's annualized ROA % for the quarter that ended in Jun. 2017 was 7.84%.


Historical Data

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

* Premium members only.

International Business Machines Corp Annual Data

Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16
Asset Turnover Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 0.87 0.80 0.76 0.72 0.70

International Business Machines Corp Quarterly Data

Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
Asset Turnover Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 0.17 0.19 0.16 0.16 0.16

Calculation

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

International Business Machines Corp's Asset Turnover for the fiscal year that ended in Dec. 2016 is calculated as

Asset Turnover
=Sales/Average Total Assets
=Revenue (A: Dec. 2016 )/( (Total Assets (A: Dec. 2015 )+Total Assets (A: Dec. 2016 ))/ 2 )
=79919/( (110495+117470)/ 2 )
=79919/113982.5
=0.70

International Business Machines Corp's Asset Turnover for the quarter that ended in Jun. 2017 is calculated as

Asset Turnover
=Sales/Average Total Assets
=Revenue (Q: Jun. 2017 )/( (Total Assets (Q: Mar. 2017 )+Total Assets (Q: Jun. 2017 ))/ 2 )
=19289/( (117495+120495)/ 2 )
=19289/118995
=0.16

* 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.

International Business Machines Corp's annulized ROE % for the quarter that ended in Jun. 2017 is

ROE %(Q: Jun. 2017 )
=Net Income/Total Equity
=9324/18373
=(Net Income / Revenue)*(Revenue / Total Assets)*(Total Assets / Total Equity)
=(9324 / 77156)*(77156 / 118995)*(118995/ 18373)
=Net Margin %*Asset Turnover*Leverage Ratio
=12.08 %*0.6484*6.4766
=ROA %*Leverage Ratio
=7.84 %*6.4766
=50.75 %

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

International Business Machines Corp's annulized ROA % for the quarter that ended in Jun. 2017 is

ROA %(Q: Jun. 2017 )
=Net Income/Total Assets
=9324/118995
=(Net Income / Revenue)*(Revenue / Total Assets)
=(9324 / 77156)*(77156 / 118995)
=Net Margin %*Asset Turnover
=12.08 %*0.6484
=7.84 %

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


Headlines

From the Internet

IBM
Ibm Still Compelling Valuation

- Seekingalpha 2017-10-20 14:39:19

IBM
Ibm Market Overreaction Minor Improvement

- Seekingalpha 2017-10-20 12:55:38

IBM
Buy Pullback Good Strategy Cramers Mad Money 10 19 17

- Seekingalpha 2017-10-20 07:37:18

IBM
Buy on Weakness: Cramer's 'Mad Money' Recap

- theStreet 2017-10-19 18:57:00

IBM
Ibm Removing Negative Allows Us Focus Positives

- Seekingalpha 2017-10-19 18:34:09

IBM
Best Dividend Stocks Ibm

- Seekingalpha 2017-10-19 15:03:15

IBM
Favorite High Yield Names Todays Market

- Seekingalpha 2017-10-19 14:14:43

IBM
Stocks Slide as Apple and Nike Take Down Dow

- theStreet 2017-10-19 09:35:00

IBM
Stock Market News For Oct 19, 2017

- Zacks 2017-10-19 09:00:00

IBM
Market Waiting Tax Reform Cramers Mad Money 10 18 17

- Seekingalpha 2017-10-19 07:40:47

IBM
Ibm Investors Alter Perceptions Wake Quarterly Results

- Seekingalpha 2017-10-19 03:09:34

IBM
Kiss Dividend Strategy Worth 15 Percent Year

- Seekingalpha 2017-10-19 02:45:59

IBM
J And J Unattractive

- Seekingalpha 2017-10-19 00:18:42

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)

GF Chat

{{numOfNotice}}
FEEDBACK