Coterra Energy Inc (CTRA)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 21.11 | 14.85 | 14.56 | 22.21 | 27.11 |
| Receivables turnover | 4.94 | 5.84 | 6.38 | 3.08 | 6.64 |
| Payables turnover | 1.17 | 1.09 | 1.09 | 1.16 | 2.51 |
| Working capital turnover | 2.50 | 16.66 | 8.89 | 3.77 | 56.38 |
Coterra Energy Inc's inventory turnover has shown a decreasing trend over the years, from 27.11 in 2020 to 21.11 in 2024. This indicates that the company is holding onto its inventory for a longer period before selling it.
The receivables turnover ratio reflects how efficiently the company collects its outstanding receivables. Coterra Energy Inc's receivables turnover decreased significantly from 6.64 in 2020 to 4.94 in 2024, indicating a slower collection of receivables over the years.
In terms of payables turnover, the company's performance remained relatively stable with values around 1.09 to 1.17 from 2021 to 2024. This suggests that the company takes a similar amount of time to pay its suppliers.
The working capital turnover ratio measures how effectively the company is utilizing its working capital to generate sales. Coterra Energy Inc's working capital turnover fluctuated notably, from 56.38 in 2020 to 2.50 in 2024. This indicates a significant decline in the efficiency of working capital utilization over the years.
Overall, based on these activity ratios, Coterra Energy Inc's efficiency in managing inventory, collecting receivables, paying suppliers, and utilizing working capital has shown varying trends over the years, signaling potential areas for improvement in the company's operations.
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 | 17.29 | 24.58 | 25.08 | 16.44 | 13.46 |
| Days of sales outstanding (DSO) | days | 73.83 | 62.46 | 57.18 | 118.53 | 55.00 |
| Number of days of payables | days | 313.13 | 334.58 | 335.94 | 314.84 | 145.39 |
Coterra Energy Inc's activity ratios provide insights into the efficiency with which the company manages its inventory, receivables, and payables.
1. Days of Inventory on Hand (DOH):
- The company's inventory turnover has shown some fluctuation over the years. From 13.46 days in 2020, it increased to 25.08 days by 2022 but then decreased to 17.29 days by 2024. This suggests that the company held inventory for shorter periods in recent years, indicating better inventory management efficiency.
2. Days of Sales Outstanding (DSO):
- Coterra Energy Inc's DSO increased significantly from 55.00 days in 2020 to 118.53 days in 2021, indicating a longer time taken to collect receivables. However, the DSO improved slightly to 73.83 days by 2024. Lower DSO indicates faster collection of accounts receivable and better liquidity.
3. Number of Days of Payables:
- The number of days of payables has been increasing consistently over the years, from 145.39 days in 2020 to 313.13 days in 2024. This indicates that the company is taking longer to pay its suppliers, potentially improving its cash flow position in the short term but may strain relationships with suppliers in the long run.
In summary, Coterra Energy Inc has shown improvements in managing its inventory efficiency and accounts receivable collection over the years. However, the increasing number of days of payables suggests a potential trade-off where the company is delaying payments to suppliers to manage its cash flow, which could have implications for supplier relationships in the future.
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 0.31 | 0.33 | 0.52 | 0.20 | 0.36 |
| Total asset turnover | 0.25 | 0.29 | 0.45 | 0.17 | 0.32 |
The analysis of Coterra Energy Inc's long-term activity ratios indicates fluctuations in its operational efficiency over the five-year period from December 31, 2020, to December 31, 2024.
1. Fixed Asset Turnover:
- The fixed asset turnover ratio measures how efficiently the company utilizes its fixed assets to generate sales.
- In 2020, the ratio was 0.36, which implies that Coterra generated $0.36 in revenue for each dollar of fixed assets. This ratio decreased to 0.20 by the end of 2021, indicating a decline in asset utilization efficiency.
- However, there was a significant improvement in 2022 as the ratio increased to 0.52, reflecting a better utilization of fixed assets to generate sales.
- The ratio decreased again in 2023 to 0.33 and further to 0.31 by the end of 2024. These reductions suggest a decline in efficiency in utilizing fixed assets to generate revenue.
2. Total Asset Turnover:
- The total asset turnover ratio measures how effectively the company uses its total assets to generate revenue.
- Coterra's total asset turnover ratio was 0.32 in 2020, implying that the company generated $0.32 in revenue for each dollar invested in total assets.
- This ratio decreased to 0.17 by the end of 2021, indicating a decline in overall asset utilization efficiency.
- There was an improvement in 2022 with a ratio of 0.45, signifying a better utilization of total assets to generate sales.
- However, the ratio declined in 2023 to 0.29 and further to 0.25 by the end of 2024, suggesting a decrease in efficiency in using total assets to generate revenue.
Overall, the trends in both fixed asset turnover and total asset turnover ratios for Coterra Energy Inc indicate fluctuations in the company's ability to efficiently generate sales based on its fixed and total assets over the five-year period. Further analysis and comparison with industry benchmarks may provide deeper insights into the company's operational performance and efficiency.