DTE Energy Company (DTE)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 0.90 | 0.99 | 1.03 | 1.19 | 9.79 |
| Receivables turnover | 0.22 | 0.25 | 8.81 | 8.18 | 6.80 |
| Payables turnover | 0.81 | 0.77 | 0.60 | 0.72 | 1.05 |
| Working capital turnover | — | — | — | — | 15.09 |
Based on the provided data, we can analyze the activity ratios of DTE Energy Company as follows:
1. Inventory Turnover:
- DTE Energy Company's inventory turnover has declined significantly over the years, from 9.79 in 2020 to 0.90 in 2024. This indicates that the company is holding onto its inventory for a longer period, which may suggest inefficiencies in managing inventory levels or potential issues with demand forecasting.
2. Receivables Turnover:
- The receivables turnover for DTE Energy Company shows a fluctuating trend, increasing from 6.80 in 2020 to 8.81 in 2022 before dropping sharply to 0.22 in 2024. A low receivables turnover ratio could imply that the company is struggling to collect outstanding payments from customers efficiently, potentially impacting cash flows.
3. Payables Turnover:
- DTE Energy Company's payables turnover has also varied over the years, decreasing from 1.05 in 2020 to 0.81 in 2024. A decreasing payables turnover ratio may indicate that the company is taking longer to pay its suppliers, which could lead to strained supplier relationships or potential liquidity issues.
4. Working Capital Turnover:
- The data provided indicates that the working capital turnover is not available for the years 2021 to 2024. Working capital turnover is a measure of how efficiently a company is utilizing its working capital to generate sales. The lack of data for these years makes it challenging to assess the company's efficiency in this aspect.
In conclusion, DTE Energy Company's activity ratios reflect fluctuations in inventory turnover, receivables turnover, and payables turnover over the years. These ratios suggest potential inefficiencies in inventory management, collection of receivables, and payment of payables, which could impact the company's overall financial performance and liquidity.
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 | 406.46 | 368.85 | 355.56 | 307.94 | 37.27 |
| Days of sales outstanding (DSO) | days | 1,638.46 | 1,475.69 | 41.42 | 44.64 | 53.71 |
| Number of days of payables | days | 452.82 | 476.28 | 605.44 | 507.48 | 348.28 |
Based on the activity ratios provided for DTE Energy Company, we can observe the following trends:
1. Days of Inventory on Hand (DOH):
- The DOH ratio indicates the average number of days it takes for the company to sell its inventory.
- DTE Energy's DOH has shown a significant increase over the years, from 37.27 days in 2020 to 406.46 days in 2024.
- The rising trend in DOH may suggest potential issues with inventory management, such as overstocking or slowing sales.
2. Days of Sales Outstanding (DSO):
- DSO measures how long it takes for a company to collect its accounts receivable.
- DTE Energy's DSO decreased from 53.71 days in 2020 to 44.64 days in 2021, but then spiked to 1,638.46 days in 2024.
- The sharp increase in DSO in the last two years may indicate challenges in collecting payments from customers promptly, possibly impacting cash flow.
3. Number of Days of Payables:
- The number of days of payables reflects how long it takes for the company to pay its suppliers.
- DTE Energy's days of payables have fluctuated, with a peak of 605.44 days in 2022 and a decrease to 452.82 days in 2024.
- A longer payment period may suggest that the company is taking advantage of favorable credit terms, but it could also signal strained supplier relationships.
Overall, the trends in DTE Energy's activity ratios highlight potential areas of concern regarding inventory management, accounts receivable collection, and supplier payments. Further analysis and monitoring of these ratios are necessary to understand the underlying factors influencing the company's operational efficiency and financial performance.
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 0.01 | 0.02 | 0.67 | 0.56 | 0.50 |
| Total asset turnover | 0.01 | 0.01 | 0.45 | 0.38 | 0.27 |
The fixed asset turnover ratio for DTE Energy Company has been showing a positive trend over the years, increasing from 0.50 in 2020 to 0.67 in 2022. This indicates that the company is generating more revenue per dollar invested in fixed assets.
However, there was a significant decrease in the fixed asset turnover ratio in 2023 and 2024, dropping to 0.02 and 0.01 respectively. This suggests that the company's fixed assets are not being effectively utilized to generate revenue during those years.
When looking at the total asset turnover ratio, a similar trend is observed. The ratio has been increasing steadily from 0.27 in 2020 to 0.45 in 2022, indicating that the company is generating more revenue relative to its total assets.
The sharp decline in the total asset turnover ratio in 2023 and 2024, dropping to 0.01 for both years, is concerning as it suggests that the company's total assets are not efficiently generating revenue during those periods.
Overall, while the company has shown improvements in asset turnover ratios in the past years, the significant drops in 2023 and 2024 signal potential inefficiencies in asset utilization that may require further investigation and management attention.