Equifax Inc (EFX)

Short-term

Turnover ratios

The activity ratios of Equifax, Inc. over the past five years show varying trends in the efficiency of its operations.

1. Receivables Turnover Ratio:
The receivables turnover ratio measures how efficiently a company is collecting payments from its customers. Equifax's receivables turnover has been relatively stable over the past five years, ranging from 5.80 in 2023 to 6.77 in 2021. This indicates that Equifax is able to collect payments from its customers approximately 5.80 to 6.77 times a year, on average.

2. Payables Turnover Ratio:
The payables turnover ratio reflects how quickly a company pays its suppliers. Equifax's payables turnover has shown fluctuations, with a notable increase from 8.68 in 2022 to 11.82 in 2023. A higher payables turnover ratio suggests that Equifax is taking longer to pay its suppliers, which could be beneficial in terms of managing its cash flow or negotiating better payment terms.

3. Inventory Turnover Ratio:
Unfortunately, the inventory turnover ratio data is missing from the table, which means we cannot analyze how efficiently Equifax is managing its inventory levels and generating sales from its inventory. A higher turnover ratio generally indicates that inventory is selling quickly, reducing storage costs and potentially minimizing holding risks.

4. Working Capital Turnover Ratio:
The working capital turnover ratio, which is also missing from the table, measures how effectively a company is using its working capital to generate sales revenue. A higher ratio typically indicates efficient utilization of working capital to drive sales.

Overall, the analysis of Equifax's activity ratios suggests that the company has been relatively efficient in managing its receivables and payables turnover over the past five years. The missing data for inventory turnover and working capital turnover limits a comprehensive assessment of Equifax's operational efficiency.

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Average number of days

Days of inventory on hand (DOH) is not provided in the data for Equifax, Inc. over the past five years.

Days of sales outstanding (DSO) measures how long it takes for a company to collect its accounts receivable. Equifax's DSO has slightly increased from 55.37 days in 2019 to 62.96 days in 2023, indicating a longer time to collect payments from customers.

The number of days of payables measures how long it takes for a company to pay its suppliers. Equifax has been effectively managing its payables over the past five years, with the number of days of payables decreasing from 35.57 days in 2019 to 30.89 days in 2023. This suggests that Equifax has been able to negotiate more favorable payment terms with its suppliers.

Overall, there is room for improvement in managing accounts receivable to reduce DSO and further optimize the cash conversion cycle. Efforts to streamline collections and maintain healthy supplier relationships can help in enhancing liquidity and working capital efficiency at Equifax.

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Long-term

Equifax, Inc.'s long-term activity ratios reflect the efficiency of the company in utilizing its fixed assets and total assets to generate revenue over the years. The fixed asset turnover ratio has shown a declining trend from 3.70 in 2019 to 2.87 in 2023. This indicates that the company is generating less revenue per dollar of fixed assets invested, possibly due to slower growth in sales compared to the growth in fixed assets.

On the other hand, the total asset turnover ratio has been relatively stable around 0.43-0.45 over the past five years. This suggests that Equifax, Inc. is effectively utilizing its total assets to generate revenue, with each dollar of assets generating consistent levels of sales.

Overall, while the company may need to focus on improving the efficiency of its fixed asset utilization, its performance in terms of total asset turnover remains steady. Further analysis of the underlying reasons for the declining fixed asset turnover ratio could provide insights into potential areas for improvement in the company's long-term asset management strategies.