CTS Corporation (CTS)

Short-term

Turnover ratios

The activity ratios of CTS Corporation provide insights into its operational efficiency over time.

1. Inventory Turnover: The inventory turnover for CTS Corporation has shown fluctuations over the periods provided, ranging from a low of 5.41 to a high of 6.77. A higher inventory turnover indicates that the company is selling its inventory more quickly, which is generally favorable as it reduces holding costs and the risk of obsolete inventory. However, the decreasing trend from 6.63 in June 2022 to 5.75 in September 2024 should be monitored for any potential impact on the company's liquidity and profitability.

2. Receivables Turnover: The data does not include information on receivables turnover for CTS Corporation, which limits the ability to assess the efficiency of the company in collecting its accounts receivables. A high receivables turnover ratio would indicate that the company is efficient in collecting payments from its customers.

3. Payables Turnover: Similar to receivables turnover, the data does not provide information on payables turnover for CTS Corporation. Payables turnover ratio helps in understanding how quickly the company pays its suppliers, which can impact cash flow management and relationships with vendors.

4. Working Capital Turnover: The working capital turnover ratio reflects how effectively the company is utilizing its working capital to generate sales. CTS Corporation's working capital turnover has varied over the periods, with a range of 2.23 to 3.51. A higher turnover ratio indicates that the company is efficiently using its working capital to support its operations and generate revenue.

In conclusion, while the inventory turnover and working capital turnover ratios provide insights into CTS Corporation's operational efficiency, the lack of data on receivables and payables turnover limits a comprehensive analysis of the company's overall activity ratios. Monitoring these ratios over time can help identify trends and potential areas for improvement in the company's operational performance.

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Average number of days

Based on the provided data for CTS Corporation, let's analyze the activity ratios:

1. Days of Inventory on Hand (DOH):
- CTS Corporation's days of inventory on hand ranged from 54.74 days to 67.47 days over the past several quarters.
- The company's inventory turnover has fluctuated within this range, indicating variations in its ability to manage and sell inventory efficiently.
- A decrease in the DOH ratio would suggest the company is improving its inventory management, while an increase may indicate inefficiencies in managing inventory levels.

2. Days of Sales Outstanding (DSO):
- The DSO data is not available for analysis, which indicates that information on the average number of days it takes for CTS Corporation to collect its accounts receivable is not provided.
- Without DSO figures, it is challenging to assess the company's effectiveness in collecting payments from customers in a timely manner.

3. Number of Days of Payables:
- Similar to DSO, the data on the number of days of payables is not available for analysis, which suggests that information on the average number of days it takes the company to pay its suppliers is missing.
- The payables turnover ratio is crucial for evaluating the company's liquidity and the efficiency of its working capital management.

In conclusion, while we can assess CTS Corporation's inventory management efficiency through the DOH ratio, the lack of data for DSO and the number of days of payables limits our ability to provide a comprehensive analysis of the company's overall activity ratios.

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Long-term

The fixed asset turnover ratio measures how efficiently a company is utilizing its fixed assets to generate revenue. CTS Corporation's fixed asset turnover has shown an improving trend from March 31, 2020, to December 31, 2023, ranging from 3.79 to 6.08 times, indicating that the company is generating more revenue from its fixed assets over time. However, the data for the last four quarters of 2024 is not available, making it difficult to assess the recent trend accurately.

On the other hand, the total asset turnover ratio reflects how effectively a company is using all its assets to generate sales. CTS Corporation's total asset turnover has fluctuated over the period with a range from 0.63 to 0.79, showing some variability in asset utilization efficiency. The ratio generally increased from 2020 to 2022 before leveling off and experiencing a slight decline in late 2023 and early 2024.

Overall, CTS Corporation seems to be efficiently utilizing its fixed assets to generate revenue, as indicated by the improving trend in the fixed asset turnover ratio over the years. However, the variability in the total asset turnover ratio suggests that there may be changes in the company's asset composition or operating efficiency that require further investigation.