Crocs Inc (CROX)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 8.78 | 7.66 | 5.78 | 7.72 | 6.78 |
| Receivables turnover | 15.64 | 12.25 | 11.02 | 11.18 | 9.07 |
| Payables turnover | 11.81 | 11.30 | 11.80 | 10.16 | 10.53 |
| Working capital turnover | 31.00 | 17.89 | 8.89 | 8.23 | 6.84 |
Based on the provided data on Crocs Inc's activity ratios, we can observe the following trends:
1. Inventory Turnover: Crocs Inc's inventory turnover ratio has shown a fluctuating pattern over the years, ranging from 5.78 in 2022 to 8.78 in 2024. The company is effectively managing its inventory turnover, with an overall increasing trend, indicating that it is selling its goods more efficiently.
2. Receivables Turnover: The receivables turnover ratio for Crocs Inc has consistently improved over the years, from 9.07 in 2020 to 15.64 in 2024. This signifies that the company is collecting its receivables at a faster rate, indicating good management of its accounts receivables.
3. Payables Turnover: Crocs Inc's payables turnover ratio has remained relatively stable over the years, hovering around 10-12 times per year. This suggests that the company is managing its payables effectively, maintaining consistency in its payment cycles.
4. Working Capital Turnover: The working capital turnover ratio for Crocs Inc has shown significant growth from 6.84 in 2020 to 31.00 in 2024. This indicates that the company is efficiently using its working capital to generate sales revenue, reflecting a strong operational performance and effective utilization of resources.
In conclusion, Crocs Inc demonstrates strong management of its activity ratios, with improvements in inventory turnover, receivables turnover, and working capital turnover, indicating efficient operations and effective utilization of resources. Keeping payables turnover stable also showcases consistency in payment practices.
Average number of days
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 41.58 | 47.67 | 63.19 | 47.31 | 53.82 |
| Days of sales outstanding (DSO) | days | 23.33 | 29.80 | 33.11 | 32.64 | 40.25 |
| Number of days of payables | days | 30.92 | 32.31 | 30.93 | 35.93 | 34.66 |
To analyze Crocs Inc's activity ratios, we can look at three key metrics: Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Number of Days of Payables.
1. Days of Inventory on Hand (DOH):
- Crocs Inc's DOH has shown variability over the years, ranging from a low of 41.58 days on December 31, 2024, to a high of 63.19 days on December 31, 2022.
- A decreasing trend in DOH indicates that the company is managing its inventory more efficiently, ensuring faster turnover of stock.
- The lower the number of days of inventory on hand, the better, as it signifies that inventory is being sold quickly, reducing the risk of obsolescence and storage costs.
2. Days of Sales Outstanding (DSO):
- Crocs Inc's DSO has generally decreased over the years, from 40.25 days on December 31, 2020, to 23.33 days on December 31, 2024.
- A decreasing trend in DSO suggests that the company is collecting its accounts receivable more efficiently, indicating strong credit control and timely payments from customers.
- A lower DSO reflects better liquidity and cash flow management for the company.
3. Number of Days of Payables:
- Crocs Inc's number of days of payables has fluctuated slightly, with a range of 30.92 days on December 31, 2024, to 34.66 days on December 31, 2020.
- A consistent or decreasing trend in the number of days of payables may indicate that the company is effectively managing its supplier payments, potentially leveraging favorable credit terms.
- Efficient management of payables can help improve the company's working capital position and cash flow.
Overall, based on the trends in these activity ratios, Crocs Inc appears to be effectively managing its inventory, accounts receivable, and payables, which are essential for maintaining liquidity, optimizing cash flow, and supporting overall financial health.
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 16.76 | 15.94 | 18.85 | 21.14 | 23.94 |
| Total asset turnover | 0.85 | 0.82 | 0.76 | 1.48 | 1.23 |
Long-term activity ratios provide insights into how efficiently a company is utilizing its assets over an extended period. In the case of Crocs Inc, we observed a declining trend in the Fixed Asset Turnover ratio from 23.94 in 2020 to 16.76 in 2024. This suggests that the company's ability to generate revenue from its fixed assets has decreased over the years.
Similarly, the Total Asset Turnover ratio increased from 1.23 in 2020 to 1.48 in 2021, indicating that the company effectively utilized its total assets to generate revenue. However, the ratio declined in the following years, reaching 0.85 in 2024, implying a decreased efficiency in generating sales from total assets.
Overall, the declining trend in both the Fixed Asset Turnover and Total Asset Turnover ratios signifies a potential inefficiency in asset utilization by Crocs Inc over the long term. This could indicate issues with asset management or operational inefficiencies that may require further investigation.