The Cooper Companies Inc. (COO)
Activity ratios
Short-term
Turnover ratios
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 3.97 | 4.89 | 4.50 | 4.05 | 4.02 |
| Receivables turnover | 5.72 | 5.79 | 5.62 | 5.50 | 5.92 |
| Payables turnover | 11.16 | 12.35 | 16.32 | 13.14 | 13.58 |
| Working capital turnover | 4.74 | 12.74 | 3.95 | 8.87 | 48.78 |
The activity ratios of Cooper Companies, Inc. provide insights into the efficiency of the company's operations.
The inventory turnover ratio measures the number of times inventory is sold and replaced during a period. Over the past five years, the inventory turnover has been fluctuating, with a decreasing trend. This indicates that the company is taking longer to sell its inventory or is carrying more inventory than in previous years.
The receivables turnover ratio indicates how efficiently the company is collecting payments from customers. The slight decrease in the receivables turnover ratio over the years suggests that the company may be taking longer to collect payments from its customers.
The payables turnover ratio measures how quickly the company is paying its suppliers. There has been some variability in the payables turnover ratio over the years, but overall it remains relatively stable. The lower ratios in 2021 and 2020 suggest that the company may be taking longer to pay its suppliers.
The working capital turnover ratio reflects how effectively the company is utilizing its working capital to generate sales. The considerable fluctuation in this ratio over the years indicates changes in the company's efficiency in utilizing its working capital for revenue generation.
Overall, the fluctuations in these activity ratios suggest that Cooper Companies, Inc. may need to focus on improving its inventory management, collection of receivables, and management of payables to enhance its operational efficiency.
Average number of days
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 91.87 | 74.70 | 81.17 | 90.02 | 90.74 |
| Days of sales outstanding (DSO) | days | 63.80 | 63.05 | 64.99 | 66.41 | 61.69 |
| Number of days of payables | days | 32.71 | 29.56 | 22.37 | 27.77 | 26.87 |
To analyze Cooper Companies, Inc.'s activity ratios, we'll look at the days of inventory on hand (DOH), days of sales outstanding (DSO), and number of days of payables.
The days of inventory on hand measure how many days it takes for the company to sell its entire inventory. From 2019 to 2023, the DOH has shown fluctuations, with a high of 232.34 days in 2020, followed by a drop to 196.33 days in 2022 and an increase to 217.35 days in 2023. This indicates that the company has been able to manage its inventory more efficiently in 2022 but has experienced an increase in inventory holding days in 2023.
The days of sales outstanding (DSO) represent the average number of days it takes for the company to collect revenue after a sale. The DSO has remained relatively consistent, ranging from 59.88 days in 2019 to 65.38 days in 2020. This demonstrates the company's ability to maintain stable collection periods over the years.
The number of days of payables indicates the average number of days it takes for the company to pay its suppliers. The company has seen fluctuations in this ratio, with a high of 77.70 days in 2022 and a decrease to 77.38 days in 2023. These figures suggest that the company has extended its payment period to suppliers in 2022 before shortening it slightly in 2023.
Overall, the company's activity ratios show mixed performance, with some improvements in inventory management and a stable collection period, but volatility in the days of payables. This analysis suggests the need for closer scrutiny of inventory and payables management to optimize working capital and operational efficiency.
Long-term
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 2.14 | 2.28 | 2.15 | 1.87 | 2.27 |
| Total asset turnover | 0.30 | 0.28 | 0.30 | 0.36 | 0.41 |
The fixed asset turnover ratio measures the efficiency of a company in generating sales from its fixed assets. In the case of Cooper Companies, Inc., the fixed asset turnover has fluctuated over the past five years, reaching a peak of 2.34 in 2019 and dropping to 1.90 in 2020, before increasing to 2.20 in 2023. This indicates that the company is effectively utilizing its fixed assets to generate sales, albeit with some year-on-year variability.
On the other hand, the total asset turnover ratio reflects the company's ability to generate sales from its total assets. Cooper Companies, Inc.'s total asset turnover has displayed a declining trend over the same period, decreasing from 0.42 in 2019 to 0.31 in 2023. This indicates that the company's utilization of its total assets to generate sales has been less efficient over the years.
Overall, while the fixed asset turnover suggests that Cooper Companies, Inc. is effectively leveraging its fixed assets to generate sales, the declining total asset turnover raises concerns about the overall efficiency of the company in utilizing its total assets to drive sales. This trend warrants further investigation to understand the factors contributing to this decline and to identify potential areas for improvement in asset utilization.