Total asset turnover (TTM)
factor.formula
Average Total Assets =
The calculation formula for total asset turnover (TTM) is:
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Refers to the cumulative operating income of the most recent 12 months (Trailing Twelve Months, TTM), reflecting the company's operating scale and profitability in the past year.
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It refers to the average of the total assets at the beginning and end of the calculation period (usually a fiscal year or quarter), which is used to eliminate the impact of fluctuations in asset size on the turnover rate calculation.
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Refers to the total assets of the enterprise at the beginning of the calculation period.
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Refers to the total assets of the enterprise at the end of the calculation period.
factor.explanation
The economic significance of total asset turnover (TTM) is that it measures how much operating income a company can generate for every 1 yuan of total assets invested. A higher total asset turnover indicates that the company has strong asset operation efficiency and can effectively use its assets to create income. This indicator can help investors and creditors evaluate the management efficiency and profitability of a company, as well as potential investment or loan risks. It should be noted that the asset turnover levels in different industries vary greatly, so industry factors should be considered when making comparisons. In addition, a high turnover rate does not always mean good corporate performance, but may also reflect that the company's investment in assets is insufficient, resulting in increased operating risks. Therefore, when analyzing, it is necessary to combine other financial indicators of the company and industry characteristics for comprehensive consideration.