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Asset Turnover

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Dictionary Says

Definition of 'Asset Turnover'

The amount of sales generated for every dollar's worth of assets. It is calculated by dividing sales in dollars by assets in dollars.

Formula:
Asset Turnover


This ratio is more useful for growth companies to check if in fact they are growing revenue in proportion to sales.

Also known as the Asset Turnover Ratio.

Investopedia Says

Investopedia explains 'Asset Turnover'

Asset turnover measures a firm's efficiency at using its assets in generating sales or revenue - the higher the number the better. It also indicates pricing strategy: companies with low profit margins tend to have high asset turnover, while those with high profit margins have low asset turnover.

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