Biogen Inc (BIIB)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 2.09 | 2.19 | 3.76 | 4.19 | 1.69 |
| Receivables turnover | 6.89 | 5.91 | 5.97 | 7.09 | 7.03 |
| Payables turnover | 12.10 | 13.74 | 10.29 | 9.62 | 3.97 |
| Working capital turnover | 5.02 | 2.87 | 1.56 | 3.09 | 4.28 |
Biogen Inc's activity ratios provide insights into the efficiency of the company's management of its assets and liabilities.
1. Inventory Turnover:
Biogen's inventory turnover has improved over the years, indicating that the company is selling its inventory at a faster pace. The ratio increased from 1.69 in 2020 to 4.19 in 2021 but showed a slight decline in 2024. Overall, the efficiency in managing inventory has been positive.
2. Receivables Turnover:
The receivables turnover ratio remained relatively stable over the period, with values ranging from 5.91 to 7.09. This indicates that Biogen is collecting its receivables in a consistent and efficient manner, with minimal fluctuations.
3. Payables Turnover:
Biogen's payables turnover ratio significantly increased from 3.97 in 2020 to 12.10 in 2024. This suggests that the company is paying its suppliers at a faster rate, which can be advantageous in terms of cash management and supplier relationships.
4. Working Capital Turnover:
The working capital turnover ratio fluctuated over the years, ranging from 1.56 to 5.02. A higher ratio implies that Biogen is generating more revenue with less capital investment, reflecting efficient use of working capital.
Overall, Biogen Inc's activity ratios demonstrate improvements in inventory turnover and payables turnover, indicating better asset and liability management. The stable receivables turnover and fluctuating working capital turnover suggest the need for continued monitoring and potential optimization in these areas.
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 | 175.04 | 166.44 | 96.99 | 87.07 | 216.06 |
| Days of sales outstanding (DSO) | days | 52.99 | 61.75 | 61.17 | 51.50 | 51.96 |
| Number of days of payables | days | 30.18 | 26.56 | 35.46 | 37.96 | 91.98 |
Based on the provided data for Biogen Inc, let's analyze the activity ratios:
1. Days of Inventory on Hand (DOH):
- Biogen Inc's DOH has shown fluctuations over the years, with a significant decrease from 216.06 days in December 2020 to 87.07 days in December 2021. This indicates a more efficient management of inventory during that period. However, there was a subsequent increase in DOH to 166.44 days by December 2023 and 175.04 days by December 2024, suggesting a potential buildup of inventory levels.
2. Days of Sales Outstanding (DSO):
- The DSO for Biogen Inc has remained relatively stable over the years, ranging from 51.50 days in December 2021 to 52.99 days in December 2024. This indicates that the company has been able to collect its accounts receivable in a consistent manner without significant fluctuations.
3. Number of Days of Payables:
- Biogen Inc's days of payables have shown a consistent downward trend, decreasing from 91.98 days in December 2020 to 30.18 days by December 2024. A decreasing number of days of payables can be indicative of the company paying its suppliers more quickly, potentially improving relationships but also impacting cash flow.
Overall, these activity ratios provide insights into how effectively Biogen Inc manages its inventory, collects its accounts receivable, and pays its suppliers. The fluctuations and trends observed in these ratios can signal changes in the company's working capital management and operational efficiency over the years.
See also:
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 3.04 | 2.97 | 3.08 | 3.21 | 3.94 |
| Total asset turnover | 0.34 | 0.37 | 0.41 | 0.46 | 0.55 |
Biogen Inc's fixed asset turnover ratio has been gradually declining over the years, from 3.94 in 2020 to 3.04 in 2024. This suggests that the company is generating fewer revenues relative to its fixed assets, which may indicate inefficiency in utilizing its long-term assets to generate sales.
Similarly, the total asset turnover ratio for Biogen Inc has also been decreasing, falling from 0.55 in 2020 to 0.34 in 2024. A declining total asset turnover ratio indicates that the company is generating less revenue for each dollar of total assets it possesses.
Overall, the decreasing trend in both fixed asset turnover and total asset turnover ratios for Biogen Inc may imply potential inefficiencies in utilizing its assets to generate revenue. It is important for the company to monitor and improve these ratios to enhance its long-term operational efficiency and profitability.