Appfolio Inc (APPF)

Short-term

Turnover ratios

Analysis of Appfolio Inc Activity Ratios:

1. Receivables Turnover:
- Appfolio's receivables turnover has been fluctuating over the past five years, with a peak in 2020 and a decline in 2023. This ratio indicates how effectively the company is managing its accounts receivable by collecting outstanding balances from customers. A higher turnover ratio is generally favorable as it shows that the company is efficient in converting credit sales into cash.

2. Payables Turnover:
- The payables turnover ratio for Appfolio has shown a significant increase from 2019 to 2023. This ratio reflects how quickly the company is paying its suppliers or creditors. A higher turnover ratio suggests that the company is effectively managing its payables by promptly settling its obligations.

3. Working Capital Turnover:
- Appfolio's working capital turnover has decreased steadily from 2019 to 2023. This ratio measures how efficiently the company is generating revenue from its working capital. A higher turnover ratio indicates that the company is efficiently utilizing its working capital to support its operations and generate sales.

Overall, Appfolio's activity ratios suggest that the company has been improving its efficiency in managing receivables and payables over the years, although there has been a decline in working capital turnover. These ratios provide insights into the company's operational performance and efficiency in utilizing its resources to drive revenue growth.

---

Average number of days

Days of inventory on hand (DOH) for Appfolio Inc are not provided in the data. Moving on to Days of Sales Outstanding (DSO), the company's DSO has shown inconsistency over the past five years, starting at 10.85 days in 2019, decreasing to 7.40 days in 2020, and then increasing to 16.12 days in 2023. This indicates that the company takes, on average, 16.12 days to collect its accounts receivable in 2023.

In terms of Number of Days of Payables, Appfolio Inc has been managing its payables effectively as the number of days of payables has been decreasing over the past five years. In 2019, it took the company 3.65 days to pay its obligations, which has decreased to 0.87 days in 2023.

Overall, the trend in the DSO indicates a mixed performance in managing accounts receivable while the days of payables show a positive trend in managing payables efficiently. Tracking these activity ratios can help evaluate the effectiveness of Appfolio Inc in managing its working capital and cash flow.

---

Long-term

The fixed asset turnover ratio of Appfolio Inc has shown a fluctuating trend over the past five years, with a significant increase from 2019 to 2020, followed by a slight decrease in 2021 and another increase in 2022, before reaching its peak in 2023. This ratio indicates that the company has been efficiently utilizing its fixed assets to generate sales, as reflected by the large values, particularly in 2023.

On the other hand, the total asset turnover ratio of Appfolio Inc has also displayed an increasing pattern over the same period, showcasing the company's ability to generate more revenue from its total assets. This ratio demonstrates how effectively the company is using all its assets to generate sales. The values have consistently improved each year, with a notable jump from 2020 to 2021 and steady growth thereafter.

Overall, both ratios suggest that Appfolio Inc has been successful in utilizing its assets, both fixed and total, efficiently to generate sales, with a notable improvement in performance in recent years. This indicates a positive trend in the company's long-term activity management and operational efficiency.