Avient Corp (AVNT)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 8.80 | 8.73 | 14.75 | 9.51 | 10.48 |
| Receivables turnover | 7.57 | 8.66 | 7.39 | 6.13 | 8.49 |
| Payables turnover | 7.06 | 7.16 | 10.50 | 6.60 | 9.51 |
| Working capital turnover | 4.77 | 5.45 | 5.35 | 3.95 | 3.46 |
Avient Corp's inventory turnover has shown a decreasing trend over the last five years, from 8.45 in 2019 to 6.49 in 2023. This indicates that the company is selling its inventory at a slower rate in recent years. Conversely, the receivables turnover has generally increased over the same period, reflecting an improvement in the company's ability to collect outstanding receivables efficiently.
In terms of payables turnover, Avient Corp saw a decline from 7.67 in 2019 to 5.21 in 2023, indicating that the company is taking longer to pay off its trade payables. The working capital turnover has shown a generally increasing trend, indicating that the company is generating revenue more efficiently relative to its working capital.
Overall, Avient Corp's activity ratios suggest a mixed performance, with improvements in receivables turnover and working capital turnover offset by decreases in inventory turnover and payables turnover. Further analysis is needed to understand the underlying reasons for these trends and their impact on the company's overall operational efficiency.
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 | 41.50 | 41.79 | 24.75 | 38.38 | 34.81 |
| Days of sales outstanding (DSO) | days | 48.24 | 42.13 | 49.42 | 59.53 | 42.97 |
| Number of days of payables | days | 51.70 | 50.95 | 34.76 | 55.27 | 38.39 |
Days of Inventory on Hand (DOH) measures how many days it takes for a company to sell its inventory. Avient Corp's DOH has been increasing over the past five years, indicating that inventory turnover has been gradually slowing down.
Days of Sales Outstanding (DSO) represents the average number of days it takes for a company to collect revenue after a sale is made. Avient Corp's DSO has fluctuated over the years but has generally been stable, demonstrating reasonable efficiency in collecting receivables.
Number of Days of Payables shows how long a company takes to pay its suppliers. Avient Corp's payables period has varied, but there is a noticeable trend of the company taking longer to pay its suppliers in recent years.
Overall, Avient Corp's activity ratios suggest that the company may be facing challenges in managing its inventory efficiently, but it has been relatively effective in collecting receivables. However, the trend of longer payment periods to suppliers is something to keep an eye on as it may impact the company's relationships with vendors.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 2.94 | 3.64 | 7.06 | 4.56 | 6.88 |
| Total asset turnover | 0.51 | 0.63 | 0.95 | 0.65 | 0.86 |
The fixed asset turnover ratio measures how efficiently a company generates revenue from its investment in fixed assets. Avient Corp's fixed asset turnover ratio has fluctuated over the past five years, decreasing from 7.13 in 2021 to 3.05 in 2023. This suggests that the company is generating less revenue from its fixed assets in 2023 compared to the previous years.
On the other hand, the total asset turnover ratio indicates how well a company utilizes all its assets to generate revenue. Avient Corp's total asset turnover ratio has also shown a decreasing trend, from 0.96 in 2021 to 0.53 in 2023. This decline indicates that the company is generating less revenue relative to its total assets in 2023 compared to the previous years.
Overall, both the fixed asset turnover and total asset turnover ratios have decreased over the past five years, signaling a potential decline in Avient Corp's efficiency in utilizing its assets to generate revenue. This trend is worth further investigation to identify the underlying factors impacting the company's long-term activity performance.