Caesars Entertainment Corporation (CZR)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 78.85 | 73.95 | 92.88 | 43.48 | 48.59 |
| Receivables turnover | 14.81 | 13.91 | 15.05 | 5.88 | 39.58 |
| Payables turnover | 8.89 | 13.89 | 15.36 | 11.46 | 14.11 |
| Working capital turnover | — | — | 10.65 | 0.63 | — |
Caesars Entertainment Inc's activity ratios provide insight into the efficiency of the company's operations.
1. Inventory turnover: This ratio shows how many times Caesars turns over its inventory in a given period. A higher ratio indicates better inventory management efficiency. The trend shows an increasing inventory turnover over the years, reflecting improvements in inventory management.
2. Receivables turnover: This ratio measures how efficiently Caesars collects payments from its customers. The increasing trend from 2019 to 2021, followed by a slight decrease in 2022 and 2023, suggests improvements in the company's accounts receivable management.
3. Payables turnover: This ratio indicates how quickly Caesars pays off its suppliers. A higher ratio suggests efficient management of payables. The decreasing trend from 2019 to 2023 could indicate the company taking longer to pay its suppliers, potentially improving cash flow.
4. Working capital turnover: Though data is missing for some years, a higher working capital turnover ratio shows that Caesars is effectively utilizing its working capital to generate revenue. The significant increase from 2020 to 2021 indicates a positive impact on revenue generation.
Overall, the activity ratios reflect varying degrees of improvement in Caesars' operational efficiency over the years, with a focus on inventory management, receivables collection, payables management, and working capital utilization.
Average number of days
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 4.63 | 4.94 | 3.93 | 8.40 | 7.51 |
| Days of sales outstanding (DSO) | days | 24.65 | 26.25 | 24.25 | 62.11 | 9.22 |
| Number of days of payables | days | 41.06 | 26.27 | 23.77 | 31.86 | 25.88 |
Caesars Entertainment Inc's activity ratios provide insights into its efficiency in managing its inventory, receivables, and payables.
The Days of Inventory on Hand (DOH) ratio indicates the number of days it takes for the company to sell its inventory. A lower DOH is generally favorable as it suggests efficient inventory management. Caesars' DOH has fluctuated over the years, with a significant decrease from 9.08 days in 2020 to 3.11 days in 2023, indicating improved inventory turnover efficiency.
The Days of Sales Outstanding (DSO) ratio reveals the average number of days it takes for the company to collect payments from customers. A lower DSO signifies efficient accounts receivable management. Caesars' DSO has varied, reaching a peak of 40.14 days in 2020 and then decreasing to 19.25 days in 2023, suggesting enhanced effectiveness in collecting receivables.
The Number of Days of Payables ratio reflects the average number of days it takes for the company to pay its suppliers. A higher number of days indicates a longer time taken to settle payables. Caesars' payables period has also fluctuated, with an increase from 19.06 days in 2019 to 27.60 days in 2023, suggesting a lengthening of the payment period.
Overall, the trend in Caesars' activity ratios shows improvements in inventory management and receivables collection efficiency, offset by a lengthening of the payables period. Management should continue to monitor these ratios to ensure optimal working capital management and operational efficiency.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 0.61 | 0.58 | 0.49 | 17.27 | 0.87 |
| Total asset turnover | 0.27 | 0.25 | 0.19 | 0.06 | 0.40 |
The long-term activity ratios of Caesars Entertainment Inc, as indicated by the fixed asset turnover and total asset turnover, reflect the company's efficiency in generating sales relative to its asset base over the past five years.
The fixed asset turnover ratio has fluctuated over the period, ranging from a low of 0.24 in 2020 to a high of 0.78 in 2023. This ratio indicates that, on average, Caesars has been generating $0.78 of revenue for every dollar invested in fixed assets in 2023. The increasing trend in this ratio suggests that the company has been able to better utilize its fixed assets to drive sales in recent years, potentially through improved operational efficiency or increased asset utilization.
Similarly, the total asset turnover ratio has also shown variability, with values ranging from 0.10 in 2020 to 0.35 in 2023. This ratio signifies how effectively Caesars is generating revenue in relation to its total assets. A higher total asset turnover ratio implies that the company is efficiently utilizing its total asset base to generate sales. The increasing trend in this ratio may indicate that Caesars has been more successful in leveraging its asset base to generate revenue over the years, potentially through strategic investments or improved operational management.
Overall, the improving trends in both the fixed asset turnover and total asset turnover ratios for Caesars Entertainment Inc suggest that the company has been enhancing its efficiency in utilizing assets to drive sales and generate revenue, which could positively impact its financial performance and long-term sustainability.