Bristol-Myers Squibb Company (BMY)

Activity ratios

Short-term

Turnover ratios

	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Inventory turnover	12.42	10.53	12.16	14.80	5.68
Receivables turnover	4.49	4.12	4.67	4.95	5.00
Payables turnover	8.82	8.60	9.36	10.52	4.34
Working capital turnover	8.04	4.73	8.57	4.07	3.83

Based on the provided data for Bristol-Myers Squibb Company, the activity ratios can provide insights into how efficiently the company is managing its resources.

1. Inventory Turnover:
- Bristol-Myers Squibb's inventory turnover has been fluctuating over the years, ranging from 5.68 to 14.80. This indicates how many times the company's inventory is sold and replaced within a specific period. On average, the company is able to turn over its inventory quite efficiently, with a decreasing trend from 2021 to 2024, which could suggest improved inventory management.

2. Receivables Turnover:
- The receivables turnover ratio measures how efficiently the company collects its accounts receivable. Bristol-Myers Squibb's receivables turnover ratios have remained relatively stable over the years, ranging from 4.12 to 5.00. A stable or slightly decreasing trend in this ratio can indicate consistent collection practices.

3. Payables Turnover:
- The payables turnover ratio reflects how quickly the company pays its suppliers. Bristol-Myers Squibb's payables turnover has shown an increasing trend over the years, from 4.34 to 10.52. This increase suggests that the company is taking longer to pay its suppliers, potentially indicating a favorable position in managing its payable obligations efficiently.

4. Working Capital Turnover:
- The working capital turnover ratio assesses how effectively the company utilizes its working capital to generate sales. Bristol-Myers Squibb's working capital turnover has shown fluctuations over the years, with a peak in 2022. This may suggest variations in the company's working capital management effectiveness.

Overall, analyzing these activity ratios can help stakeholders assess Bristol-Myers Squibb's operational efficiency, including inventory management, accounts receivable collection, payable obligations handling, and working capital utilization in generating revenue. It is important to compare these ratios with industry benchmarks and historical data to gain a better understanding of the company's performance.

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	29.38	34.66	30.01	24.66	64.30
Days of sales outstanding (DSO)	days	81.21	88.57	78.17	73.72	72.98
Number of days of payables	days	41.38	42.43	39.01	34.71	84.11

Based on the provided data, we can analyze Bristol-Myers Squibb Company's activity ratios as follows:

1. Days of Inventory on Hand (DOH):
- The company's DOH decreased significantly from 64.30 days in 2020 to 24.66 days in 2021, indicating that Bristol-Myers Squibb managed its inventory more efficiently. However, there was a slight increase in 2022 to 30.01 days before rising to 34.66 days in 2023 and then falling to 29.38 days in 2024.

2. Days of Sales Outstanding (DSO):
- The DSO remained relatively stable over the years, with a slight increase from 72.98 days in 2020 to 73.72 days in 2021. It further increased to 78.17 days in 2022, followed by a significant rise to 88.57 days in 2023 and a decrease to 81.21 days in 2024. This indicates that the company has been extending credit to customers for a longer period in recent years.

3. Number of Days of Payables:
- Bristol-Myers Squibb Company was managing its payables effectively as the number of days of payables decreased from 84.11 days in 2020 to 34.71 days in 2021. There was a slight increase in 2022 to 39.01 days before rising further to 42.43 days in 2023 and then decreasing to 41.38 days in 2024. This suggests the company's ability to optimize its payment terms with suppliers.

Overall, the analysis of the activity ratios shows that Bristol-Myers Squibb Company has made improvements in managing its inventory levels and accounts payable, while the days of sales outstanding have shown some fluctuation over the years.

Long-term

	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Fixed asset turnover	6.77	6.77	7.38	7.67	7.22
Total asset turnover	0.52	0.47	0.48	0.42	0.36

The Fixed Asset Turnover ratio reflects how efficiently Bristol-Myers Squibb Company is utilizing its fixed assets to generate revenue. Over the five-year period from December 31, 2020, to December 31, 2024, the company's Fixed Asset Turnover ratio has shown some fluctuations but generally remained high, ranging from 6.77 to 7.67.

This indicates that Bristol-Myers Squibb is effectively generating revenue in relation to its investment in fixed assets such as property, plant, and equipment. A higher Fixed Asset Turnover ratio is typically associated with greater efficiency in asset utilization.

In parallel, the Total Asset Turnover ratio measures the company's overall efficiency in generating sales from all its assets. The data shows an increasing trend in this ratio from 0.36 in December 31, 2020, to 0.52 in December 31, 2024.

The rise in the Total Asset Turnover ratio suggests that Bristol-Myers Squibb has been improving its ability to generate sales relative to its total assets over the years. This may indicate improvements in operational efficiency, optimal utilization of resources, or effective management of assets to drive revenue growth.

Overall, these long-term activity ratios suggest that Bristol-Myers Squibb Company has been proficient in efficiently utilizing both its fixed assets and total assets to drive revenue generation and operational performance.