Agilent Technologies Inc (A)
Activity ratios
Short-term
Turnover ratios
| Oct 31, 2024 | Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 4.88 | 5.32 | 4.80 | 5.75 | 6.02 |
| Receivables turnover | 4.44 | 4.88 | 4.54 | 5.04 | 4.68 |
| Payables turnover | 8.79 | 13.12 | 8.60 | 10.71 | 12.24 |
| Working capital turnover | 3.16 | 2.63 | 3.53 | 2.98 | 2.71 |
Agilent Technologies Inc's activity ratios provide insights into how efficiently the company manages its assets and liabilities to generate sales.
1. Inventory Turnover: This ratio indicates how many times Agilent Technologies Inc's inventory was sold and replenished during the year. The decreasing trend from 2020 to 2024 suggests that the company is holding onto its inventory for slightly longer periods, which could indicate slower sales or potentially overstocking.
2. Receivables Turnover: The receivables turnover ratio reflects how quickly Agilent Technologies Inc collects payments from its customers. The slight fluctuations in this ratio over the years indicate a stable collection efficiency, with a minor decline in 2021 and a recovery in 2024.
3. Payables Turnover: This ratio signifies how quickly Agilent Technologies Inc pays its suppliers. The decreasing trend from 2020 to 2024 may indicate a longer payment period, which could imply better cash flow management or potentially strained supplier relationships.
4. Working Capital Turnover: This ratio measures how effectively Agilent Technologies Inc utilizes its working capital to generate revenue. The increasing trend from 2020 to 2024 indicates improvement in the company's ability to leverage its current assets efficiently to support sales growth.
Overall, the analysis of Agilent Technologies Inc's activity ratios suggests a mixed operational efficiency performance over the years, with some areas showing improvement while others exhibit slight declines or fluctuations. Further analysis and comparison with industry benchmarks could provide more insights into the company's operational strengths and weaknesses.
Average number of days
| Oct 31, 2024 | Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 74.77 | 68.62 | 75.97 | 63.43 | 60.66 |
| Days of sales outstanding (DSO) | days | 82.21 | 74.84 | 80.39 | 72.46 | 78.04 |
| Number of days of payables | days | 41.54 | 27.82 | 42.45 | 34.09 | 29.83 |
Activity ratios provide insights into how efficiently a company manages its inventory, receivables, and payables. Looking at Agilent Technologies Inc's data over the past five years, we observe trends in its activity ratios.
1. Days of Inventory on Hand (DOH):
- Agilent's DOH has fluctuated over the years, ranging from 60.66 days in 2020 to 75.97 days in 2022.
- The increasing trend from 2020 to 2022 suggests that the company may be holding onto inventory for longer periods, which could tie up capital and lead to higher holding costs.
- However, the decrease in DOH in 2023 and 2024 indicates that Agilent may have improved its inventory management efficiency in recent years.
2. Days of Sales Outstanding (DSO):
- Agilent's DSO has also varied, with the lowest value of 72.46 days in 2021 and the highest value of 82.21 days in 2024.
- Generally, a lower DSO indicates faster collection of receivables, which helps improve cash flow and liquidity.
- The fluctuating trend in DSO suggests that Agilent may have experienced changes in its credit policies, customer payment behavior, or sales volume over the years.
3. Number of Days of Payables:
- Agilent's days of payables have shown volatility, ranging from 29.83 days in 2020 to 42.45 days in 2022.
- A higher number of days of payables indicates that the company is taking longer to pay its suppliers, which can be beneficial for cash flow management.
- The fluctuating nature of this ratio implies that Agilent may have adjusted its payment terms with suppliers or managed its working capital differently in response to changing business conditions.
In conclusion, monitoring activity ratios like DOH, DSO, and number of days of payables is crucial for evaluating Agilent's operational efficiency and working capital management. Fluctuations in these ratios highlight the company's efforts to optimize inventory levels, accelerate receivables collection, and strategically manage payables to support its financial health and performance.
Long-term
| Oct 31, 2024 | Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 3.67 | 5.34 | 6.16 | 6.60 | 6.24 |
| Total asset turnover | 0.55 | 0.63 | 0.64 | 0.58 | 0.55 |
The long-term activity ratios of Agilent Technologies Inc have shown fluctuations over the past five years. The fixed asset turnover, which indicates how efficiently the company is utilizing its fixed assets to generate sales, has gradually decreased from 6.24 in 2020 to 3.67 in 2024. This trend indicates a declining efficiency in generating sales relative to its fixed assets.
On the other hand, the total asset turnover, representing how effectively the company is utilizing all assets to generate revenue, has fluctuated over the period. It increased from 0.55 in 2020 to a peak of 0.64 in 2022, before slightly declining to 0.55 in 2024. This suggests that while Agilent Technologies Inc was able to generate more revenue from its assets in 2022, the efficiency in asset utilization decreased in 2024.
Overall, the analysis of these long-term activity ratios reflects varying levels of efficiency in utilizing assets to generate sales over the past five years. Agilent Technologies Inc may need to further analyze its asset management strategies to improve these ratios and enhance its overall operational performance.