Benchmark Electronics Inc (BHE)

Short-term

Turnover ratios

The activity ratios of Benchmark Electronics Inc. indicate the efficiency of the company's management of its operations and assets over the past five years.

1. Inventory Turnover:
- The inventory turnover ratio has generally been decreasing from 6.57 in 2019 to 3.76 in 2023. This suggests that the company is selling its inventory less frequently in recent years, which may indicate potential issues with inventory management or changing demand patterns.

2. Receivables Turnover:
- The receivables turnover ratio has also shown a slight decreasing trend from 6.97 in 2019 to 6.32 in 2023. This indicates that the company is collecting its receivables slightly slower over the years, which could potentially signal changes in credit policies or customer payment behavior.

3. Payables Turnover:
- The payables turnover ratio has fluctuated over the years, with a notable increase from 4.80 in 2021 to 6.99 in 2023. This suggests that the company is taking longer to pay its suppliers in recent years, which could be a deliberate strategy to manage cash flow or negotiate better payment terms.

4. Working Capital Turnover:
- The working capital turnover ratio has been relatively stable around the range of 2.85 to 3.25 over the five-year period. This ratio indicates how efficiently the company is using its working capital to generate sales. The stable trend suggests that the company has been effectively utilizing its working capital to support its operations.

In summary, Benchmark Electronics Inc. should closely monitor its inventory and receivables turnover ratios to ensure efficient management of its assets and liquidity. The increasing payables turnover ratio may have strategic implications, and the stable working capital turnover ratio indicates effective utilization of resources for generating sales.

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Average number of days

The activity ratios of Benchmark Electronics Inc. provide insights into the efficiency of the company's operations over the past five years.

1. Days of Inventory on Hand (DOH): This ratio measures how many days on average it takes for the company to sell its inventory. The increasing trend from 55.60 days in 2019 to 97.19 days in 2023 indicates a lengthening of the time it takes to convert inventory into sales. This could suggest potential issues with inventory management or slowing sales.

2. Days of Sales Outstanding (DSO): DSO reflects the average number of days it takes for the company to collect payments from customers. The trend has been increasing from 52.39 days in 2019 to 57.78 days in 2023. A rising DSO may indicate difficulties in collecting receivables promptly, which could impact cash flow and liquidity.

3. Number of Days of Payables: This ratio measures how many days on average it takes for the company to pay its suppliers. The fluctuating trend from 53.49 days in 2019 to 52.23 days in 2023 suggests varying payment terms with suppliers. A lower number of days of payables implies the company is paying its suppliers more quickly, potentially affecting cash flow management.

Overall, the analysis of activity ratios for Benchmark Electronics Inc. indicates a decline in inventory turnover efficiency and increasing challenges in collecting receivables over the years. It is important for the company to address these trends to improve operational efficiency and maintain healthy cash flows.

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Long-term

The long-term activity ratios of Benchmark Electronics Inc. provide insights into the company's efficiency in utilizing its assets to generate revenue over the past five years. The fixed asset turnover ratio measures how effectively the company is utilizing its fixed assets to generate sales. Benchmark Electronics Inc. has shown a fluctuating trend in fixed asset turnover, with the ratio ranging from 11.02 to 13.65 over the period analyzed. The increasing trend from 2020 to 2022 indicates a positive improvement in the utilization of fixed assets, although there was a slight decrease in 2023.

On the other hand, the total asset turnover ratio signifies the company's overall efficiency in generating sales from all its assets, including both fixed and current assets. Benchmark Electronics Inc. has shown relatively stable total asset turnover ratios over the five-year period, ranging from 1.18 to 1.30. This stability suggests that the company has been able to maintain a consistent level of revenue generation in relation to its total asset base.

Overall, the analysis of long-term activity ratios indicates that Benchmark Electronics Inc. has demonstrated efficiency in utilizing its assets to generate revenue, with a notable improvement in fixed asset turnover over the years. However, further examination and comparison with industry benchmarks would provide a more comprehensive assessment of the company's asset utilization efficiency.