Caesars Entertainment Corporation (CZR)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 83.93 | 78.85 | 73.95 | 92.88 | 43.48 |
| Receivables turnover | 23.87 | 14.81 | 13.91 | 15.05 | 5.88 |
| Payables turnover | 12.76 | 8.89 | 13.89 | 15.36 | 11.46 |
| Working capital turnover | — | — | — | 10.65 | 0.63 |
Caesars Entertainment Corporation's activity ratios reflect the efficiency of the company in managing its inventory, receivables, payables, and working capital.
1. Inventory Turnover:
- The inventory turnover ratio measures how quickly a company sells its inventory during a period. Caesars' inventory turnover has shown a consistent increase over the years, from 43.48 in 2020 to 83.93 in 2024. This indicates that the company has been able to sell its inventory more rapidly, which is generally a positive sign of efficient inventory management.
2. Receivables Turnover:
- The receivables turnover ratio indicates how efficiently a company collects its accounts receivable. Caesars demonstrated a significant improvement in this ratio, increasing from 5.88 in 2020 to 23.87 in 2024. This suggests that the company has been more effective in collecting payments from its customers in a timely manner.
3. Payables Turnover:
- The payables turnover ratio measures how quickly a company pays its suppliers. Caesars' payables turnover ratio fluctuated during the period, with a peak in 2021 at 15.36 and a slight decrease to 12.76 in 2024. A lower ratio could indicate that the company is taking longer to pay suppliers, which may affect relationships with vendors.
4. Working Capital Turnover:
- The working capital turnover ratio evaluates how efficiently a company utilizes its working capital to generate sales. Caesars had a significant increase in this ratio from 0.63 in 2020 to 10.65 in 2021, indicating that the company generated more sales relative to its working capital. However, data for 2022, 2023, and 2024 is not available to assess the trend further.
In conclusion, Caesars Entertainment Corporation has shown improvements in its inventory turnover and receivables turnover ratios, indicating better management of inventory and collections. However, the payables turnover ratio fluctuated, and the data gap for working capital turnover beyond 2021 limits a comprehensive analysis of the company's efficiency in utilizing its working capital for generating sales.
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 | 4.35 | 4.63 | 4.94 | 3.93 | 8.40 |
| Days of sales outstanding (DSO) | days | 15.29 | 24.65 | 26.25 | 24.25 | 62.11 |
| Number of days of payables | days | 28.60 | 41.06 | 26.27 | 23.77 | 31.86 |
Caesars Entertainment Corporation's activity ratios provide insights into its efficiency in managing inventory, collecting receivables, and paying payables.
1. Days of Inventory on Hand (DOH) decreased from 8.40 days in 2020 to 4.35 days in 2024. This suggests that the company is managing its inventory more effectively, possibly through improved inventory management practices or demand forecasting.
2. Days of Sales Outstanding (DSO) improved significantly from 62.11 days in 2020 to 15.29 days in 2024. This indicates that Caesars is collecting receivables more quickly over the years, possibly due to better credit management or a focus on timely collection efforts.
3. Number of Days of Payables decreased from 31.86 days in 2020 to 28.60 days in 2024. This indicates that the company is taking slightly longer to pay its payables, which could be a strategic move to manage cash flow more efficiently or negotiate better payment terms with suppliers.
Overall, the trend across these activity ratios suggests that Caesars Entertainment Corporation has been enhancing its operational efficiency and working capital management over the years, which is a positive indicator of the company's financial health.
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 0.76 | 0.61 | 0.58 | 0.49 | 17.27 |
| Total asset turnover | 0.34 | 0.27 | 0.25 | 0.19 | 0.06 |
The fixed asset turnover ratio measures how efficiently a company generates revenue from its investments in fixed assets. Looking at the data provided for Caesars Entertainment Corporation, the fixed asset turnover ratio declined significantly from 17.27 in December 31, 2020, to 0.49 in December 31, 2021. This sharp decrease could indicate a possible issue with the utilization of fixed assets or a decrease in revenue generated from these assets.
However, there seems to be a slight improvement over the subsequent years, with the ratio increasing to 0.58 in December 31, 2022, 0.61 in December 31, 2023, and 0.76 in December 31, 2024. This upward trend suggests that the company may have made efforts to enhance the efficiency of its fixed asset utilization, leading to better revenue generation from these assets.
On the other hand, the total asset turnover ratio, which indicates how well a company utilizes its total assets to generate sales, also saw an increase over the years for Caesars Entertainment Corporation. The ratio improved from 0.06 in December 31, 2020, to 0.19 in December 31, 2021, 0.25 in December 31, 2022, 0.27 in December 31, 2023, and 0.34 in December 31, 2024. This upward trend suggests that the company is becoming more efficient in generating sales relative to its total asset base.
In summary, while the fixed asset turnover ratio initially declined significantly before showing gradual improvement, the total asset turnover ratio saw consistent improvement over the years for Caesars Entertainment Corporation. This indicates that the company may be making positive changes to enhance the efficiency of its asset utilization, leading to better revenue generation and overall performance.