The Cheesecake Factory (CAKE)

Activity ratios

Short-term

Turnover ratios

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Inventory turnover 21.46 10.83 13.44 17.18 27.87 35.01 40.79 44.26 45.39 44.07 42.21 38.67 38.89 39.85 37.85 35.37 34.96 32.83 33.81 36.88
Receivables turnover 124.50 108.23 111.83 — 153.48 134.52 79.35 83.86 80.93 68.47 71.23 57.06 53.76 29.54 21.50 34.68 82.09 — — —
Payables turnover 19.59 11.90 11.25 17.77 23.23 36.93 36.20 33.46 35.95 36.05 31.92 26.88 26.15 24.43 26.65 30.26 26.65 43.45 43.27 42.59
Working capital turnover — — — — — — — — — — — — — — — — — 154.60 — —

The Cheesecake Factory's activity ratios suggest efficient management of its inventory and receivables, while also maintaining good relationships with its suppliers. The inventory turnover has shown a generally decreasing trend over the past few periods, indicating that the company is selling its inventory more quickly. The receivables turnover ratio has also been relatively high, demonstrating that the company is efficient in collecting payments from customers.

In terms of payables turnover, the company has been able to manage its payments effectively as the ratio has been relatively stable over the periods provided. This indicates that The Cheesecake Factory is paying its suppliers in a timely manner without impacting its cash flow negatively.

However, the working capital turnover ratio data is not available for analysis. This could be due to the nature of the company's operations or the data collection process. Overall, based on the available data, The Cheesecake Factory appears to be effectively managing its working capital and operating cycle, which is a positive indicator of its operational efficiency.

Average number of days

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Days of inventory on hand (DOH) days 17.01 33.72 27.16 21.25 13.10 10.43 8.95 8.25 8.04 8.28 8.65 9.44 9.39 9.16 9.64 10.32 10.44 11.12 10.79 9.90
Days of sales outstanding (DSO) days 2.93 3.37 3.26 — 2.38 2.71 4.60 4.35 4.51 5.33 5.12 6.40 6.79 12.36 16.98 10.53 4.45 — — —
Number of days of payables days 18.63 30.68 32.43 20.53 15.71 9.88 10.08 10.91 10.15 10.12 11.44 13.58 13.96 14.94 13.69 12.06 13.70 8.40 8.44 8.57

The activity ratios of The Cheesecake Factory over the past few quarters reveal some interesting trends.

1. Days of Inventory on Hand (DOH):
The days of inventory on hand have been fluctuating over the period under review. At the end of December 2023, the company had 17.01 days' worth of inventory on hand, which is a significant decrease from the 33.72 days at the end of September 2023. The decreasing trend from September 2023 to December 2023 suggests the company is managing its inventory more efficiently, potentially reducing carrying costs and improving cash flows.

2. Days of Sales Outstanding (DSO):
The days of sales outstanding have also shown variability during the period. At the end of December 2023, the DSO stood at 2.93 days, which is lower compared to the 3.37 days at the end of September 2023. A lower DSO typically indicates that the company is collecting revenues more quickly, which is a positive indicator of efficient accounts receivable management.

3. Number of Days of Payables:
The number of days of payables has also been fluctuating from quarter to quarter. At the end of December 2023, the company had 18.63 days of payables, an increase from the 30.68 days at the end of September 2023. This suggests that the company is taking longer to pay its suppliers, potentially improving its cash flow position by utilizing trade credit effectively.

Overall, analyzing these activity ratios for The Cheesecake Factory provides insights into how the company is managing its inventory, receivables, and payables. The fluctuations observed in these ratios indicate the company's efforts to optimize its working capital and improve operational efficiency.

Long-term

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Fixed asset turnover 3.25 3.33 3.30 3.32 4.43 4.22 4.24 4.15 3.95 3.58 3.24 2.62 2.56 2.69 2.72 3.05 2.99 3.13 3.11 3.07
Total asset turnover 0.91 0.93 0.92 0.92 1.19 1.17 1.14 1.12 1.05 1.00 0.91 0.73 0.72 0.75 0.76 0.93 0.87 1.00 1.14 1.13

The fixed asset turnover ratio for The Cheesecake Factory fluctuated over the periods analyzed, with values ranging from 2.56 to 4.43. This ratio measures how efficiently the company is generating sales from its investments in fixed assets. A higher fixed asset turnover ratio indicates that the company is utilizing its fixed assets more effectively to generate revenue.

On the other hand, the total asset turnover ratio varied between 0.72 and 1.19 during the same periods. This ratio reflects the company's ability to generate sales from all of its assets. A higher total asset turnover ratio suggests that the company is effectively utilizing its total assets to generate revenue.

Overall, the fixed asset turnover ratios for The Cheesecake Factory generally remained higher and more stable compared to the total asset turnover ratios over the periods analyzed. This indicates that the company is better at efficiently using its fixed assets to generate sales revenue than its total assets. It's important to monitor these ratios over time to assess the company's operational efficiency and asset utilization.