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What is capex intensity?

capital intensity. Measure of a firm’s efficiency in deployment of its assets, computed as a ratio of the total value of assets to sales revenue generated over a given period. Indicates how successful a firm is in utilizing its assets in generation of sales revenue.

Similarly, what does capital intensity mean?

Capital intensity is the amount of fixed or real capital present in relation to other factors of production, especially labor. At the level of either a production process or the aggregate economy, it may be estimated by the capital to labor ratio, such as from the points along a capital/labor isoquant.

Similarly, what is considered high capex? Five companies with high capital expenditures (CAPEX) include Tesla Motors, General Motors, Apple Computer, Nike and Facebook. The capital expenditures of these five companies from different industries are compared using the CAPEX to sales ratio and free cash flow to CAPEX ratio.

Likewise, how do you calculate capital intensity?

Capital intensity ratio of a company is a measure of the amount of capital needed per dollar of revenue. It is calculated by dividing total assets of a company by its sales. It is reciprocal of total asset turnover ratio.

What is the capital intensity ratio at full capacity?

Capital Intensity Ratio. The capital intensity ratio reveals the amount of assets your business requires to generate $1 in sales. It equals total assets divided by annual sales. For this ratio, a smaller figure is better.

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