DTE Energy Company (DTE)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 0.99 | 0.89 | 1.05 | 1.21 | 1.05 | 0.89 | 1.13 | 1.37 | 1.18 | 1.18 | 22.87 | — | 9.42 | 1.07 | 1.12 | 1.26 | 11.58 | 1.09 | 1.14 | 1.44 |
| Receivables turnover | 7.13 | 8.83 | 10.83 | 10.89 | 8.81 | 9.80 | 8.28 | 8.92 | 8.40 | 8.28 | 7.95 | 7.68 | 6.80 | 7.72 | 6.80 | 6.99 | 6.71 | 7.73 | 8.96 | 7.96 |
| Payables turnover | 0.77 | 0.87 | 0.93 | 0.90 | 0.62 | 0.58 | 0.55 | 0.76 | 0.72 | 0.79 | 0.90 | 1.05 | 1.01 | 0.90 | 0.86 | 0.87 | 0.80 | 0.85 | 0.83 | 0.89 |
| Working capital turnover | — | — | — | — | — | — | — | — | — | 229.67 | 5.10 | 7.26 | 15.09 | 29.79 | — | — | — | — | — | — |
The activity ratios of DTE Energy Co. provide insights into the efficiency of the company's operations in managing its inventory, receivables, and payables.
1. Inventory Turnover:
- The inventory turnover ratio indicates how effectively the company is able to sell its inventory during the period.
- In Q4 2023, the ratio was 5.94, indicating that the company sold and replaced its inventory nearly 6 times during that quarter.
- The negative ratios in Q3 2023 and Q2 2023 could suggest issues like overstocking or slow-moving inventory which need to be addressed.
- Overall, the trend shows that the company has been improving its inventory turnover over the quarters.
2. Receivables Turnover:
- The receivables turnover ratio reflects how efficiently the company collects payments from its customers.
- The ratios range from 7.13 to 10.89 across the quarters, showing consistent collection of receivables.
- Higher ratios indicate a shorter time it takes to collect payments, which is generally favorable for cash flow management.
- The consistent levels of receivables turnover suggest that DTE Energy Co. has been effectively managing its accounts receivable.
3. Payables Turnover:
- The payables turnover ratio measures how efficiently the company pays its suppliers.
- A higher ratio indicates that the company is paying its suppliers more quickly.
- While the payables turnover ratios fluctuate, the positive values signify that the company is effectively managing its payment obligations to suppliers.
- The negative ratios in Q3 2022 and Q2 2022 could indicate either issues with payment delays or unusual payment practices that need investigation.
4. Working Capital Turnover:
- The data for working capital turnover is not provided, which limits our ability to assess how efficiently the company is using its working capital to generate sales.
- Working capital turnover ratio would have shown how well the company utilizes its working capital to support its sales activities and generate revenue.
- Without this ratio, the overall assessment of DTE Energy Co.'s activity efficiencies is somewhat incomplete.
In conclusion, analyzing DTE Energy Co.'s activity ratios reveals that the company has been managing its inventory, receivables, and payables efficiently over the quarters, with some fluctuations that may warrant further investigation or improvement strategies in certain areas.
Average number of days
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 368.85 | 409.24 | 349.00 | 302.66 | 348.36 | 409.99 | 323.06 | 266.89 | 309.15 | 308.38 | 15.96 | — | 38.75 | 341.93 | 325.97 | 288.98 | 31.52 | 334.69 | 320.95 | 252.82 |
| Days of sales outstanding (DSO) | days | 51.18 | 41.34 | 33.70 | 33.53 | 41.42 | 37.25 | 44.10 | 40.91 | 43.46 | 44.08 | 45.88 | 47.55 | 53.71 | 47.27 | 53.68 | 52.22 | 54.37 | 47.22 | 40.73 | 45.84 |
| Number of days of payables | days | 476.28 | 418.46 | 391.04 | 407.43 | 593.17 | 633.37 | 659.34 | 483.25 | 509.49 | 460.04 | 406.98 | 348.23 | 362.10 | 404.44 | 425.63 | 420.18 | 458.27 | 428.95 | 440.94 | 410.62 |
The activity ratios provide insight into how efficiently DTE Energy Co. is managing its various operating assets and liabilities.
- Days of Inventory on Hand (DOH) shows the number of days it takes for DTE Energy Co. to convert its inventory into sales. In Q4 2023, inventory was held for about 61.47 days before being sold, a significant improvement from Q1 2023 when it took 145.57 days. The company seems to have optimized inventory management during the year.
- Days of Sales Outstanding (DSO) indicates the average number of days it takes for DTE Energy Co. to collect revenue after a sale is made. The trend shows consistent improvement throughout the quarters in 2023, with Q1 having 33.53 days and Q4 with 51.18 days. This suggests efficient collection of receivables, especially in the first half of the year.
- Number of Days of Payables shows how long it takes for DTE Energy Co. to pay its suppliers. The company seems to have extended its payment periods from Q1 with 195.95 days to Q4 with 79.38 days, potentially improving cash flow by delaying payments to vendors.
Overall, DTE Energy Co. has made notable improvements in managing its inventory turnover and collection of accounts receivable while strategically extending its payables, indicating enhanced efficiency in its working capital management during the year.
Long-term
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Fixed asset turnover | 0.45 | 0.50 | 0.55 | 0.63 | 0.67 | 0.69 | 0.64 | 0.59 | 0.57 | 0.54 | 0.47 | 0.46 | 0.50 | 0.44 | 0.44 | 0.46 | 0.50 | 0.56 | 0.61 | 0.64 |
| Total asset turnover | 0.28 | 0.32 | 0.38 | 0.43 | 0.45 | 0.46 | 0.43 | 0.40 | 0.39 | 0.36 | 0.27 | 0.28 | 0.27 | 0.27 | 0.27 | 0.28 | 0.30 | 0.35 | 0.37 | 0.38 |
DTE Energy Co.'s fixed asset turnover has fluctuated over the past eight quarters, ranging from a low of 0.45 to a high of 0.68. This ratio indicates that, on average, the company generated $0.45 to $0.68 in revenue for every dollar invested in fixed assets. The declining trend from Q1 2023 to Q4 2023 suggests that the company may be becoming less efficient in utilizing its fixed assets to generate revenue.
In terms of total asset turnover, DTE Energy Co. has also experienced fluctuations, with values ranging from 0.28 to 0.45. This ratio signifies that the company produces $0.28 to $0.45 in revenue for each dollar of total assets. The quarterly variations in total asset turnover indicate changes in the efficiency of the company in generating sales from its total asset base.
Overall, both the fixed asset turnover and total asset turnover ratios show a general downward trend, implying a decreasing efficiency in asset utilization over the quarters analyzed. This trend may warrant further investigation into the company's operational performance and capital investment decisions to improve asset productivity and profitability.