Community Healthcare Trust Inc (CHCT)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 0.94 | — | — | 1.06 | 12.93 |
| Receivables turnover | — | — | — | — | — |
| Payables turnover | — | — | — | — | — |
| Working capital turnover | — | 181.22 | — | — | — |
Activity ratios measure how efficiently a company utilizes its assets to generate sales. In the case of Community Healthcare Trust Inc, we have data for receivables turnover and working capital turnover from 2019 to 2023.
1. Receivables Turnover:
- The receivables turnover ratio measures how many times a company collects its average accounts receivable during a period.
- Community Healthcare Trust Inc's receivables turnover has been decreasing from 7.34 in 2019 to 4.88 in 2023.
- A lower receivables turnover may indicate a longer collection period for receivables, which could potentially impact the company's cash flows and liquidity.
2. Working Capital Turnover:
- The working capital turnover ratio shows how efficiently a company utilizes its working capital to generate revenue.
- Community Healthcare Trust Inc's working capital turnover has fluctuated over the years, with the highest value of 4.93 in 2020 and the lowest of 1.98 in 2019.
- A higher working capital turnover suggests that the company efficiently uses its working capital to support its operations and generate sales.
Overall, the trend in receivables turnover indicates a potential area for improvement in managing receivables and cash flows. On the other hand, the working capital turnover has varied, showcasing different levels of efficiency in utilizing working capital over the years. Further analysis and comparison with industry benchmarks would provide a more comprehensive understanding of Community Healthcare Trust Inc's activity ratios and operational efficiency.
Average number of days
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 388.06 | — | — | 345.10 | 28.23 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
Based on the data provided, the activity ratios of Community Healthcare Trust Inc can be analyzed as follows:
1. Days of Sales Outstanding (DSO):
- DSO measures how long it takes for the company to collect on its accounts receivable.
- The DSO has been increasing over the years, indicating that the company is taking longer to collect payments from its customers.
- A higher DSO can potentially indicate issues with credit policies, collection processes, or the creditworthiness of customers.
- The increase in DSO from 49.72 days in 2019 to 74.80 days in 2023 suggests a trend of slower collection of accounts receivable, which may impact the company's cash flow.
2. Days of Inventory on Hand (DOH):
- The data for Days of Inventory on Hand is not available, so it is difficult to provide a specific analysis on this ratio.
- This ratio typically measures how quickly the company is able to turn its inventory into sales.
- A decreasing trend in DOH would generally indicate efficient inventory management.
3. Number of Days of Payables:
- The data for Number of Days of Payables is not available.
- This ratio would typically measure how long the company takes to pay its suppliers.
- A longer payables period can indicate that the company is taking longer to pay its suppliers, which could have cash flow implications.
In conclusion, the analysis of the activity ratios of Community Healthcare Trust Inc based on the available data suggests a potential concern with the increasing Days of Sales Outstanding (DSO), which may require further investigation into the company's accounts receivable management practices and their impact on cash flow.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 0.83 | 0.83 | 0.93 | 0.90 | 0.89 |
| Total asset turnover | 0.12 | 0.11 | 0.12 | 0.11 | 0.11 |
Community Healthcare Trust Inc's long-term activity ratios show the efficiency with which the company utilizes its assets to generate revenue over the years.
1. Fixed Asset Turnover:
- The fixed asset turnover ratio has been relatively stable, averaging around 0.13 over the past five years. This indicates that for every dollar invested in fixed assets, the company generates approximately $0.13 in revenue.
- The consistent figure suggests that the company has been effectively utilizing its fixed assets to generate revenue, possibly indicating a stable operational efficiency.
2. Total Asset Turnover:
- The total asset turnover ratio measures how efficiently the company uses all of its assets to generate revenue.
- Over the past five years, the total asset turnover ratio has shown a slight fluctuation, averaging around 0.12. This indicates that for every dollar invested in total assets, the company generates approximately $0.12 in revenue.
- Although there has been some variability, the ratio has remained relatively stable, suggesting that the company is efficiently utilizing its total assets to generate revenue.
Overall, both fixed asset turnover and total asset turnover ratios suggest that Community Healthcare Trust Inc has been effectively utilizing its assets to generate revenue, with a consistent performance in asset efficiency over the past five years.