American Electric Power Co Inc (AEP)

Short-term

Turnover ratios

Based on the provided data, let's analyze the activity ratios of American Electric Power Co Inc:

1. Inventory Turnover:
- The inventory turnover ratio reflects how efficiently the company manages its inventory. An increase in inventory turnover suggests that American Electric Power Co Inc is selling its inventory at a faster rate. The inventory turnover has shown fluctuations over the years, starting at 0.99 in 2020 and peaking at 3.54 in 2024. A higher turnover indicates better inventory management.

2. Receivables Turnover:
- Receivables turnover measures how effectively the company collects its accounts receivables. The trend in this ratio for American Electric Power Co Inc has been relatively stable, ranging from 6.49 to 7.41. A higher receivables turnover ratio suggests that the company efficiently collects payments from its customers.

3. Payables Turnover:
- A higher payables turnover ratio indicates that the company is paying its suppliers more frequently. In the case of American Electric Power Co Inc, the payables turnover ratio has seen some fluctuations, starting at 0.76 in 2020 and spiking to 2.30 in 2024. An increasing trend in this ratio could imply better cash management or negotiation power with suppliers.

4. Working Capital Turnover:
- The data provided shows that the working capital turnover ratio for American Electric Power Co Inc is not available for the years analyzed. This ratio could indicate how efficiently the company is utilizing its working capital to generate sales.

Overall, analyzing these activity ratios provides insights into American Electric Power Co Inc's operational efficiency, inventory management, receivables collection, and payment practices. It is important for stakeholders to assess these ratios in conjunction with other financial metrics to gain a comprehensive understanding of the company's performance.

---

Average number of days

Based on the provided data, we can analyze the activity ratios of American Electric Power Co Inc as follows:

1. Days of Inventory on Hand (DOH):
- The company's DOH has shown fluctuations over the years, from 368.52 days in 2020 to 103.18 days in 2024.
- A decreasing trend in DOH indicates that the company is managing its inventory more efficiently and selling off goods faster, which could imply improved liquidity and reduced carrying costs.

2. Days of Sales Outstanding (DSO):
- The DSO has varied slightly, ranging from 49.29 days in 2021 to 56.21 days in 2024.
- A higher DSO suggests that the company takes longer to collect payments from its customers, potentially impacting cash flows and liquidity.

3. Number of Days of Payables:
- The number of days of payables has seen significant fluctuations, with a high of 626.18 days in 2022 and a low of 158.68 days in 2024.
- A decreasing trend in days of payables could indicate that the company is settling its payables faster, possibly due to improved vendor relationships or stricter payment terms.

In summary, American Electric Power Co Inc's activity ratios reflect changes in its inventory management, accounts receivable collection, and accounts payable practices over the years. Monitoring these ratios can provide insights into the company's operational efficiency, cash flow management, and overall financial health.

---

Long-term

The fixed asset turnover ratio measures how efficiently a company is generating revenue from its fixed assets. For American Electric Power Co Inc, this ratio has been gradually increasing over the years, from 0.23 in 2020 to 27.59 in 2024. This indicates that the company is utilizing its fixed assets more effectively to generate sales.

On the other hand, the total asset turnover ratio reflects how efficiently a company is generating sales from all its assets. In the case of American Electric Power Co Inc, this ratio has fluctuated slightly, with a peak of 0.21 in 2022 and a low of 0.18 in 2020. Overall, the total asset turnover ratio has remained relatively stable over the years, ranging from 0.18 to 0.21.

In conclusion, the increasing trend in the fixed asset turnover ratio suggests that American Electric Power Co Inc is becoming more efficient in utilizing its fixed assets to generate revenue. Although the total asset turnover ratio has fluctuated, the company has maintained a relatively stable level of efficiency in generating sales from all its assets.