Coherent Inc (COHR)

Short-term

Turnover ratios

The activity ratios of Coherent Inc. over the specified periods demonstrate notable fluctuations and trends in operational efficiency.

Inventory Turnover: The ratio increased from 2.27 times as of September 30, 2022, to 2.78 times by June 30, 2023, and remained stable at that level through September 30, 2023, before declining slightly to 2.53 times by June 30, 2024. A significant decrease is observed by June 30, 2025, where the ratio dropped sharply to 0.04, indicating a potential accumulation of inventory or reduced inventory management efficiency toward that date.

Receivables Turnover: The ratio improved consistently over the period, rising from 4.74 times as of September 30, 2022, to 5.72 times by June 30, 2023. It maintained a high level of 5.55 times through September 30, 2023, and June 30, 2024, before increasing further to 6.03 times by June 30, 2025. This trend suggests an enhancement in collection efficiency and receivables management.

Payables Turnover: Initially at 4.72 times as of September 30, 2022, the ratio increased significantly to 8.74 times by June 30, 2023, and maintained this level through September 30, 2023. Subsequently, it declined to 5.15 times by June 30, 2024, and further to 4.45 times by June 30, 2025. The initial rise indicates a faster payment cycle to suppliers, which subsequently lengthened, possibly reflecting altered payment policies or cash flow management strategies.

Working Capital Turnover: The ratio exhibited growth from 1.09 times at September 30, 2022, to 2.37 times by June 30, 2023, and maintained that level through September 30, 2023. It then declined to 2.03 times in June 2024, reaching a notably low value of 0.04 times by June 30, 2025. This sharp decline indicates a significant decrease in the efficiency with which the company utilizes its working capital to generate sales, especially approaching the last specified period, suggesting possible operational or financial constraints affecting the company's ability to optimize working capital during that timeframe.

In summary, while the company demonstrated improvements in receivables management and initial inventory management in the earlier periods, there is a discernible deterioration in inventory and working capital efficiency toward the end of the analyzed timeline. This decline could signal operational challenges, shifts in inventory or receivables policies, or broader financial considerations impacting the company's capacity to efficiently utilize its assets.

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Average number of days

The activity ratios for Coherent Inc, specifically the days of inventory on hand (DOH), days of sales outstanding (DSO), and days of payables, reveal important insights into the company's operational efficiency and working capital management over the specified periods.

Days of Inventory on Hand (DOH):
- As of September 30, 2022, the DOH was approximately 160.61 days, indicating that inventory was held for just over five months on average before being sold.
- By June 30, 2023, this figure decreased to 131.11 days, reflecting a reduction in inventory holding periods, which may suggest improved inventory management or increased sales velocity.
- The DOH remained relatively stable into September 30, 2023, at 131.12 days, maintaining the improvement seen earlier.
- However, by June 30, 2024, the DOH increased again to 144.40 days, indicating a lengthening of inventory holding periods. This shift could suggest inventory build-up, potential supply chain disruptions, or decreased turnover efficiency.
- Significantly, in the subsequent period ending June 30, 2025, the DOH markedly skyrocketed to approximately 9,421.59 days, an anomalously high figure that likely points to data inconsistency or reporting issues rather than actual operational conditions.

Days of Sales Outstanding (DSO):
- The DSO decreased from 77.07 days as of September 30, 2022, to 63.77 days by June 30, 2023, indicating an improvement in receivables collection efficiency.
- This trend continued into September 30, 2023, with a slight increase to 65.77 days, maintaining manageable receivables periods.
- The DSO remained stable at approximately 65.79 days into June 30, 2024, suggesting consistent credit and collection policies.
- By June 30, 2025, the DSO decreased further to 60.57 days, reflecting enhanced accounts receivable management and quicker cash collection.

Number of Days of Payables:
- As of September 30, 2022, the company held payables for about 77.39 days, indicating the average period taken to settle obligations.
- This decreased significantly to 41.77 days by June 30, 2023, which may suggest an improvement in payment timing or strategic reduction in credit extended to suppliers.
- The same figure persisted at September 30, 2023, maintaining the shorter payables period.
- By June 30, 2024, the days of payables increased to approximately 70.89 days, indicating a lengthening of payment periods and possible shifts in supplier relationships or credit terms.
- The figure further increased to 82.07 days by June 30, 2025, suggesting a trend toward extending payables, which could be used as a short-term financing strategy but might impact supplier relationships if extended excessively.

Overall, the activity ratios display a trend towards improved receivables collection and a fluctuating inventory management process, alongside a variable approach to accounts payable. While the early periods show progressive improvements, the data for June 30, 2025, and especially the extremely high DOH figures, indicate anomalies or potential data errors that should be interpreted with caution.

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Long-term

The analysis of Coherent Inc.'s long-term activity ratios reveals notable trends over the specified periods. The Fixed Asset Turnover ratio demonstrates an upward trajectory, increasing from 2.43 as of September 30, 2022, to 2.90 by September 30, 2023. The absence of subsequent data points for June 30, 2023, and June 30, 2024, limits the ability to infer trends beyond this date; however, the observed increase within this period indicates improved utilization of fixed assets in generating revenue.

In contrast, the Total Asset Turnover ratio exhibits a declining trend over the reporting periods, decreasing from 0.42 on September 30, 2022, to 0.38 by June 30, 2023, and remaining steady at 0.38 on September 30, 2023. Further data points for June 30, 2024, and June 30, 2025, show a continued decline to 0.32 and significantly to 0.01, respectively. This suggests a diminishing efficiency in utilizing total assets to generate sales, particularly pronounced by the June 30, 2025 data, indicating that the company's asset base is producing substantially less revenue per dollar of assets over time.

Overall, while fixed asset utilization has improved slightly during the recent period, the decline in total asset turnover signals a potential decrease in overall operational efficiency regarding asset deployment. This divergence may reflect strategic shifts, changes in asset composition, or operational challenges impacting the overall revenue-generating capacity of the company's asset base.