Cracker Barrel Old Country Store (CBRL)

Short-term

Turnover ratios

Cracker Barrel Old Country Store's inventory turnover has shown a consistent increase over the past five years, indicating that the company is efficiently managing its inventory and converting it into sales. The higher the inventory turnover ratio, the faster the company is selling its products.

In contrast, the receivables turnover ratio has fluctuated over the same period, but overall it shows that the company is collecting its accounts receivable at a relatively fast pace, which is a positive sign for its liquidity. A high receivables turnover ratio suggests that the company has effective credit policies and is able to quickly convert credit sales into cash.

The payables turnover ratio has also fluctuated but remains relatively stable, indicating that Cracker Barrel Old Country Store is managing its trade payables effectively. A higher payables turnover ratio suggests that the company is paying its suppliers in a timely manner and efficiently managing its cash flow.

Unfortunately, data for the working capital turnover ratio is not available for the most recent year, but in the previous year, the company had a working capital turnover ratio of 13.11. This ratio measures how efficiently a company is using its working capital to generate sales revenue. A higher working capital turnover ratio indicates efficient use of working capital.

Overall, based on these activity ratios, Cracker Barrel Old Country Store appears to be effectively managing its inventory, accounts receivable, and trade payables, as well as efficiently using its working capital to generate sales.

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Average number of days

Analyzing the activity ratios of Cracker Barrel Old Country Store over the past five years, we observe the following trends:

1. Days of Inventory on Hand (DOH):
- The trend in DOH indicates that the company has been able to manage its inventory efficiently over the years, with a decrease from 31.82 days in 2022 to 24.51 days in 2024. This suggests that Cracker Barrel is turning over its inventory quicker, which could be due to improved inventory management practices.

2. Days of Sales Outstanding (DSO):
- The DSO ratio reflects how quickly the company is collecting its accounts receivable. A declining trend in DSO, from 7.11 days in 2020 to 5.18 days in 2024, indicates that Cracker Barrel has been able to collect its sales proceeds more efficiently. This could be attributed to effective credit policies or prompt customer payments.

3. Number of Days of Payables:
- The days of payables ratio shows the number of days it takes for the company to pay its suppliers. With an increasing trend in the number of days of payables, from 19.33 days in 2020 to 21.98 days in 2024, Cracker Barrel seems to be taking longer to settle its payables. This may indicate a deliberate strategy to manage cash flow or negotiate favorable payment terms with suppliers.

Overall, these activity ratios suggest that Cracker Barrel Old Country Store has been improving its operational efficiency by managing inventory levels, collection of receivables, and payment to suppliers effectively over the years.

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Long-term

Cracker Barrel Old Country Store's long-term activity ratios showed positive trends over the past five years. The fixed asset turnover has been increasing steadily, indicating that the company is generating more revenue for each dollar invested in fixed assets. This suggests improved efficiency in utilizing its long-term assets to generate sales.

Similarly, the total asset turnover ratio has also been on an upward trajectory, reflecting the company's ability to generate more revenue from its total assets. This indicates that Cracker Barrel is managing its assets more effectively to generate sales, which is a positive sign for the company's overall operational efficiency.

Overall, the increasing trend in both fixed asset turnover and total asset turnover ratios demonstrates Cracker Barrel's improved efficiency in utilizing its assets to drive revenue growth, which is essential for long-term profitability and sustainability.