Asset turnover

Revenue for a specified period divided by average total assets for that period, commonly measured annually. Read it alongside profit margin and business mix to understand returns on assets.

Asset turnover in round numbers

Hypothetical: on a comparable annual basis, a distributor generates US$4 of annual revenue per US$1 of average total assets, while a manufacturer generates US$0.80. Their asset turnover is 4.0x and 0.8x respectively. Different margins and business models can offset different turnover rates.

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