Broadridge Financial Solutions Inc (BR)

Short-term

Turnover ratios

The activity ratios of Broadridge Financial Solutions Inc. over the period from June 30, 2021, through June 30, 2024, reveal several notable trends and patterns.

Inventory Turnover:
The inventory turnover ratio demonstrated a declining trend from 153.91 in 2021 to 125.38 in 2023, indicating that inventory is being sold and replenished less frequently over this period. However, a slight recovery occurred in 2024, with the ratio rising to 149.93. This fluctuation suggests potential shifts in inventory management efficiency or changes in sales volume and inventory levels.

Receivables Turnover:
This ratio remained relatively stable, with minor fluctuations: 6.09 in 2021, decreasing slightly to 6.03 in 2022, then increasing modestly to 6.22 in 2023, and maintaining stability at 6.11 in 2024. The gradual increase in 2023 and 2024 indicates improved efficiency in collecting receivables or changes in credit policies.

Payables Turnover:
The payables turnover ratio experienced fluctuations as well. It increased significantly from 14.35 in 2021 to a peak of 27.18 in 2023, indicating more frequent payments to suppliers relative to accounts payable. However, it decreased again to 14.56 in 2024 before rising somewhat to 21.57 in 2025. These shifts may reflect changes in payment strategies, supplier negotiations, or cash management policies.

Working Capital Turnover:
Data for working capital turnover is available for 2022 and 2024 only. It was substantially high at 380.61 in 2022, then decreased markedly to 54.63 in 2024. This decline suggests a reduction in the efficiency with which the company utilized working capital to generate sales during this period. The absence of data for other years indicates gaps in the analysis but underscores variability in working capital management.

Summary:
Overall, Broadridge's activity ratios exhibit signs of changes in operational efficiency. The inventory turnover's decline followed by a partial recovery could reflect inventory management adjustments. The stable receivables turnover suggests consistent collection practices, while fluctuations in payables turnover point toward evolving payment strategies. The variability in working capital turnover underscores a potential shift in overall operational efficiency or working capital management practices.

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Average number of days

The analysis of Broadridge Financial Solutions Inc.’s activity ratios over the specified period reveals trends in inventory management, receivables collection, and payables payment practices.

Days of Inventory on Hand (DOH): The company’s inventory holding period exhibits minor fluctuations, starting at approximately 2.37 days as of June 30, 2021, rising to 2.91 days by June 30, 2023, before declining again to 2.43 days in June 2024. This slight increase suggests a modest elongation in inventory turnover during 2022 and early 2023, possibly indicating a period of increased inventory accumulation or slower inventory turnover. However, the subsequent decline indicates an improvement in inventory efficiency, returning closer to the initial levels. The absence of data for June 30, 2025, limits analysis beyond 2024.

Days of Sales Outstanding (DSO): The receivables collection period remains relatively stable, fluctuating within a narrow range. It was approximately 59.96 days in 2021, marginally increasing to 60.54 days in 2022, then decreasing to 58.66 days in 2023, before rising slightly again to 59.78 days in 2024, and subsequently decreasing to 57.07 days in 2025. Overall, the DSO demonstrates a generally stable trend with minor variations, indicating consistent collection practices that do not significantly accelerate or delay receivables turnover over the period.

Number of Days of Payables: The payables period shows more variability. It decreased markedly from 25.44 days in 2021 to 13.43 days in 2023, reflecting a tendency to pay suppliers more promptly during this period. In 2024, the payable days increased back to approximately 25.06 days, suggesting a shift to extending payment terms. For 2025, the payable period reduced again to 16.92 days, indicating some moderation in payment timing but not reaching the extreme lows seen in 2023.

Summary of Trends: Overall, Broadridge’s operational activity ratios point to a pattern of stable receivables management, with minor fluctuations not indicative of significant operational shifts. Inventory levels have remained low and stable, with slight increases dropping back again, which aligns with efficient inventory management in a service-oriented company. The payables activity demonstrates periods of extended payment terms interspersed with shorter durations, reflecting strategic management of supplier payments possibly in response to cash flow considerations or supplier negotiations.

This combined activity suggests a balanced approach to working capital management, with slight adjustments possibly aimed at optimizing liquidity and operational efficiency across the observed period.

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Long-term

The analysis of Broadridge Financial Solutions Inc.'s long-term activity ratios reveals notable trends over the periods observed. The fixed asset turnover ratio exhibits a significant increase from 28.18 on June 30, 2021, to a peak of 41.60 on June 30, 2023. This trend suggests an improvement in the company's efficiency in utilizing its fixed assets to generate revenue during this period. However, there is a sharp decline to 18.68 on June 30, 2024, indicating a substantial decrease in the efficiency of fixed asset utilization. The data for June 30, 2025, is not available, precluding further trend analysis beyond 2024.

In contrast, the total asset turnover ratio shows a steady and positive upward trend across the same periods. It increased from 0.62 on June 30, 2021, to 0.70 on June 30, 2022, then to 0.74 on June 30, 2023, followed by a further rise to 0.79 on June 30, 2024, and reaching 0.81 on June 30, 2025. This consistent increase indicates an ongoing improvement in the overall efficiency with which the company utilizes its total assets to generate sales over time.

Overall, while the total asset turnover indicates a sustained enhancement in asset utilization efficiency, the fixed asset turnover experienced a peak followed by a notable decline, suggesting potential changes in asset management, asset base composition, or operational effectiveness related to fixed assets during that period.