DaVita HealthCare Partners Inc (DVA)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 15.69 | 19.13 | 17.46 | 16.82 | 18.82 |
| Receivables turnover | 5.03 | 4.55 | 4.82 | 4.74 | 4.94 |
| Payables turnover | 4.36 | 4.35 | 4.67 | 4.32 | 4.56 |
| Working capital turnover | 24.49 | 21.68 | 15.11 | 17.17 | 8.64 |
DaVita Inc's inventory turnover ratio has consistently been reported as 0.00, indicating that the company is not effectively managing its inventory levels compared to its cost of goods sold. This may suggest potential issues with inventory management or slow-moving inventory.
On the other hand, the receivables turnover ratio has been relatively stable over the years, with values ranging from 4.55 to 5.03. This implies that DaVita is efficient in collecting payments from its customers, turning its accounts receivable into cash multiple times within a year.
The payables turnover ratio is reported as 0.00 for all years, indicating that DaVita may not have significant trade payables or that the company settles its payables very quickly, possibly taking advantage of discounts offered by suppliers.
Lastly, the working capital turnover ratio has shown an increasing trend over the years, from 8.64 in 2019 to 24.49 in 2023. This suggests that DaVita is generating revenue at a faster pace relative to the level of working capital required to support its operations. A higher working capital turnover indicates efficient use of working capital to generate sales.
In summary, DaVita Inc seems to have room for improvement in managing its inventory effectively. However, the company demonstrates efficiency in collecting receivables and using its working capital to generate revenue.
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 | 23.26 | 19.08 | 20.90 | 21.69 | 19.39 |
| Days of sales outstanding (DSO) | days | 72.64 | 80.19 | 75.73 | 77.07 | 73.88 |
| Number of days of payables | days | 83.64 | 83.88 | 78.23 | 84.40 | 79.96 |
Days of sales outstanding (DSO) is a measure of how long it takes for DaVita Inc to collect revenue from its customers. A decreasing trend in DSO from 2019 to 2023 indicates that the company has been improving its efficiency in collecting payments from customers. This is a positive sign as it shows that DaVita is managing its accounts receivable more effectively, which in turn can help improve cash flow.
In contrast, the lack of data for days of inventory on hand and days of payables hinders a comprehensive analysis of DaVita's overall activity ratios. Inventory management and payables turnover are important components of working capital management and can provide insights into the company's efficiency in managing its inventory levels and paying its obligations in a timely manner.
Without the complete set of data for all activity ratios, we are unable to assess DaVita's overall efficiency in managing its working capital. However, the improvement in Days of Sales Outstanding (DSO) suggests a positive trend in terms of collecting revenue from customers efficiently.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 3.95 | 3.57 | 3.34 | 3.28 | 3.28 |
| Total asset turnover | 0.72 | 0.69 | 0.68 | 0.68 | 0.66 |
The long-term activity ratios of DaVita Inc, specifically the Fixed Asset Turnover and Total Asset Turnover, show the company's efficiency in generating sales revenue relative to its investment in fixed assets and total assets over the past five years.
1. Fixed Asset Turnover:
- The Fixed Asset Turnover ratio measures how efficiently DaVita Inc utilizes its fixed assets to generate sales revenue.
- The ratio has shown a consistent improvement from 3.28 in 2019 to 3.95 in 2023, indicating that the company has been able to generate $3.95 in sales for every $1 of fixed assets invested in the latest year.
- This trend suggests that DaVita Inc has been effectively utilizing its fixed assets to drive revenue growth and improve operational efficiency over the years.
2. Total Asset Turnover:
- The Total Asset Turnover ratio reflects DaVita Inc's ability to generate sales revenue in relation to its total assets.
- The ratio has shown a slight increasing trend from 0.66 in 2019 to 0.72 in 2023, indicating that the company has enhanced its efficiency in utilizing its total assets to generate sales revenue.
- A higher Total Asset Turnover ratio signifies that DaVita Inc is generating more sales revenue per dollar of total assets employed, reflecting improved asset utilization and operational efficiency.
Overall, the increasing trend in both Fixed Asset Turnover and Total Asset Turnover ratios suggests that DaVita Inc has successfully improved its operational efficiency and asset utilization, which may lead to enhanced profitability and sustainable growth in the long term.