Astec Industries Inc (ASTE)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 2.31 | 2.21 | 2.57 | 2.79 | 3.14 |
| Receivables turnover | — | — | — | — | — |
| Payables turnover | — | — | — | — | — |
| Working capital turnover | 2.89 | 3.18 | 3.02 | 2.63 | 2.59 |
Based on the provided data on Astec Industries Inc's activity ratios, we can analyze the following:
1. Inventory Turnover:
- The inventory turnover ratio measures how efficiently a company manages its inventory. Astec Industries Inc's inventory turnover has been decreasing over the years, from 3.14 in 2020 to 2.31 in 2024. This decline may indicate that the company is holding onto its inventory for a longer period, which could tie up capital and lead to potentially obsolete inventory.
2. Receivables Turnover:
- Unfortunately, data for receivables turnover is not available for any of the years. This ratio typically indicates how efficiently a company collects outstanding receivables from its customers. The absence of this data may limit our ability to assess Astec Industries Inc's effectiveness in managing its accounts receivable.
3. Payables Turnover:
- Similarly, data for payables turnover is not available, which could have provided insights into how quickly the company is paying its suppliers. The payables turnover ratio helps assess the efficiency of managing trade credit from suppliers.
4. Working Capital Turnover:
- The working capital turnover ratio indicates how effectively a company utilizes its working capital to generate revenue. Astec Industries Inc's working capital turnover has shown some fluctuations over the years, with an increase from 2.59 in 2020 to 3.18 in 2023, before decreasing to 2.89 in 2024. A higher ratio generally implies that the company is generating more sales revenue relative to its working capital.
In conclusion, the analysis of Astec Industries Inc's activity ratios suggests some mixed results. While the company has shown improvements in working capital turnover, the declining trend in inventory turnover warrants further investigation to ensure efficient management of inventory levels. The absence of data for receivables and payables turnover limits a comprehensive analysis of the company's overall efficiency in managing its operating cycle.
Average number of days
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 157.89 | 165.07 | 142.11 | 130.80 | 116.21 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
Astec Industries Inc's Days of Inventory on Hand (DOH) has shown an increasing trend over the period from 2020 to 2024, with the number of days the inventory is held rising from 116.21 days in 2020 to 157.89 days in 2024. This indicates that the company is holding onto its inventory for a longer period, which could tie up financial resources and result in higher holding costs.
The Days of Sales Outstanding (DSO) and Number of Days of Payables data are not available for analysis, as they are marked as not determined (― days) for all the years from 2020 to 2024. This lack of information regarding accounts receivable collection period and accounts payable payment period makes it challenging to fully assess Astec Industries Inc's efficiency in managing its working capital and cash flow.
Overall, while the increasing trend in Days of Inventory on Hand is a concern, a comprehensive analysis incorporating Days of Sales Outstanding and Number of Days of Payables would provide a more holistic view of the company's efficiency in managing its operating cycle.
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | — | — | 7.34 | 6.18 | 5.93 |
| Total asset turnover | 1.25 | 1.26 | 1.26 | 1.20 | 1.21 |
The fixed asset turnover ratio indicates Astec Industries Inc's efficiency in generating sales revenue relative to its investment in fixed assets. The increasing trend of this ratio over the years (from 5.93 in 2020 to 7.34 in 2022) suggests the company is utilizing its fixed assets more effectively to generate sales. However, the absence of data for 2023 and 2024 makes it challenging to assess the continuation of this positive trend.
On the other hand, the total asset turnover ratio reflects the company's overall efficiency in generating sales with its total assets. Astec Industries Inc's total asset turnover remained relatively stable around 1.20-1.26 from 2020 to 2024. This indicates that the company has been able to maintain a consistent level of sales generated per dollar of total assets employed.
In summary, Astec Industries Inc has shown improvement in utilizing its fixed assets more efficiently to generate sales, as indicated by the increasing fixed asset turnover ratio. The stability of the total asset turnover ratio suggests a steady performance in generating sales in relation to total assets over the years.