Asset Performance

AAA

DEFINITION of 'Asset Performance'

A business's ability to take productive resources and manage them within its operations to produce subsequent returns. Asset performance is typically used to compare one company's performance over time or against its competition. Possessing strong asset performance is one of the criteria for determining whether a company is considered a good investment.

INVESTOPEDIA EXPLAINS 'Asset Performance'

Analysts use metrics like the cash conversion cycle, the return on assets ratio and the fixed asset turnover ratio to compare and assess a company's annual asset performance. Typically, an improvement in asset performance means that a company can either earn a higher return using the same amount of assets or is efficient enough to create the same amount of return using less assets.

RELATED TERMS
  1. J-Curve Effect

    A type of diagram where the curve falls at the outset and eventually ...
  2. Anticipated Holding Period

    The time period for which a limited partnership expects to hold ...
  3. Cash Return On Assets Ratio

    A ratio used to compare a businesses performance among other ...
  4. Cash Conversion Cycle - CCC

    A metric that expresses the length of time, in days, that it ...
  5. Financial Performance

    A subjective measure of how well a firm can use assets from its ...
  6. Asset

    1. A resource with economic value that an individual, corporation ...
Related Articles
  1. Bonds & Fixed Income

    Evaluating A Company's Capital Structure

    Learn to use the composition of debt and equity to evaluate balance sheet strength.
  2. Investing Basics

    Understanding The Cash Conversion Cycle

    Find out how a simple calculation can help you uncover the most efficient companies.
  3. Investing Basics

    How To Evaluate A Company's Balance Sheet

    Asset performance shows how what a company owes and owns affects its investment quality.
  4. Economics

    What is Value Added?

    Value added is used to describe instances where a firm takes a product and adds a feature that gives customers a greater sense of value.
  5. Economics

    What is a Wholly Owned Subsidiary?

    A company whose common stock is 100% owned by another company, called the parent company.
  6. Economics

    What is the Breakeven Point?

    In general, when gains or revenue earned equals the money spent to earn the gains or revenue, you’ve hit the breakeven point.
  7. Investing

    What's Marginal Revenue?

    In microeconomics, marginal revenue is the additional revenue generated by increasing sales revenue by one unit. Another way of saying this is that the marginal revenue is the revenue generated ...
  8. Investing

    What is the Debt-To-Capital Ratio?

    The debt-to-capital ratio is used to measure a company’s use of financial leverage. The ratio is the company’s total debt, divided by the sum of the company’s equity plus total debt.
  9. Investing

    Understanding Accumulated Depreciation

    Depreciation is a rough approximation, in dollar terms, of the wear and tear on an asset. So the accumulated depreciation is the aggregate of the wear and tear on the asset from all prior time ...
  10. Professionals

    What is Backward Integration?

    Integration happens when one company owns another business in its supply chain.

You May Also Like

Hot Definitions
  1. Interest Rate Risk

    The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between ...
  2. Income Effect

    In the context of economic theory, the income effect is the change in an individual's or economy's income and how that change ...
  3. Price-To-Sales Ratio - PSR

    A valuation ratio that compares a company’s stock price to its revenues. The price-to-sales ratio is an indicator of the ...
  4. Hurdle Rate

    The minimum rate of return on a project or investment required by a manager or investor. In order to compensate for risk, ...
  5. Market Value

    The price an asset would fetch in the marketplace. Market value is also commonly used to refer to the market capitalization ...
  6. Preference Shares

    Company stock with dividends that are paid to shareholders before common stock dividends are paid out. In the event of a ...
Trading Center