Amphenol Corporation (APH)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 3.91 | 4.11 | 3.95 | 4.06 | 4.28 |
| Receivables turnover | 4.79 | 4.80 | 4.43 | 4.41 | 4.74 |
| Payables turnover | 6.27 | 6.57 | 5.70 | 5.30 | 6.47 |
| Working capital turnover | 3.41 | 3.32 | 3.10 | 2.70 | 3.96 |
Amphenol Corp.'s activity ratios reflect its efficiency in managing various aspects of its operations.
1. Inventory turnover: The company's inventory turnover has been relatively stable over the past five years, ranging from 3.91 to 4.28. This indicates that Amphenol is able to sell and replace its inventory approximately 3.9 to 4.3 times per year. A higher turnover generally suggests efficient inventory management.
2. Receivables turnover: The receivables turnover ratio has also shown consistency, hovering between 4.41 and 4.80. This implies that Amphenol collects its accounts receivable approximately 4.4 to 4.8 times per year. A higher turnover ratio suggests more efficient credit and collection policies.
3. Payables turnover: The payables turnover ratio indicates how quickly a company pays its suppliers. Amphenol's payables turnover has been in the range of 5.30 to 6.57. A higher turnover ratio suggests that the company is paying its suppliers more quickly, which can have both positive and negative implications, depending on the circumstances.
4. Working capital turnover: The working capital turnover ratio measures how efficiently a company utilizes its working capital to generate sales. Amphenol's working capital turnover has fluctuated but generally increased over the years, indicating that the company is now generating more sales for each dollar of working capital invested.
In summary, Amphenol Corp.'s activity ratios show a relatively consistent and efficient operational performance in managing its inventory, receivables, payables, and working capital turnover over the past five years.
Average number of days
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 93.38 | 88.91 | 92.49 | 89.93 | 85.25 |
| Days of sales outstanding (DSO) | days | 76.12 | 76.09 | 82.38 | 82.84 | 77.05 |
| Number of days of payables | days | 58.21 | 55.59 | 64.07 | 68.92 | 56.40 |
Amphenol Corp.'s Days of Inventory on Hand (DOH) has shown an increasing trend over the past five years, from 85.25 days in 2019 to 93.38 days in 2023. This indicates that the company is taking longer to sell its inventory, potentially tying up more cash in inventory holdings.
On the other hand, Days of Sales Outstanding (DSO) have fluctuated slightly but remained relatively stable over the same period, ranging from 76.09 days in 2022 to 82.38 days in 2021. This suggests that the company has been consistent in collecting its accounts receivable, although there may be room for improvement in this area.
The Number of Days of Payables has also fluctuated, with a noticeable increase in 2021 followed by some decrease in 2022 and 2023. This indicates that Amphenol Corp. may be taking longer to pay its suppliers in recent years.
Overall, the company's activity ratios suggest that there may be opportunities to optimize inventory management to reduce the Days of Inventory on Hand and potentially improve cash flow. Additionally, efforts to manage accounts receivable and payables more efficiently could also enhance the company's overall liquidity position.
See also:
Amphenol Corporation Short-term (Operating) Activity Ratios
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 9.55 | 10.48 | 9.25 | 8.15 | 8.23 |
| Total asset turnover | 0.76 | 0.82 | 0.74 | 0.70 | 0.76 |
Amphenol Corp.'s long-term activity ratios reflect the efficiency with which the company utilizes its assets to generate sales over the years. The fixed asset turnover ratio has shown fluctuation but generally indicates an increasing trend, improving from 8.23 in 2019 to 9.55 in 2023. This suggests that the company is generating more revenue from its fixed assets, such as property, plant, and equipment.
On the other hand, the total asset turnover ratio has seen some variability but has remained relatively stable over the period. It was 0.76 in 2019, improved to 0.82 in 2022, and then decreased slightly to 0.76 in 2023. This ratio indicates how efficiently the company is generating sales from all its assets, including both fixed and current assets.
Overall, the fixed asset turnover ratio indicates that Amphenol Corp. has been successful in utilizing its fixed assets more effectively to generate sales, while the total asset turnover ratio suggests that the company has maintained a consistent level of efficiency in generating revenue from its total assets. Further analysis in conjunction with other financial ratios and industry benchmarks would provide additional insights into the company's operational efficiency and asset utilization.