Estee Lauder Companies Inc (EL)

Activity ratios

Short-term

Turnover ratios

	Jun 30, 2024	Mar 31, 2024	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
Inventory turnover	7.10	6.49	5.76	5.35	5.09	4.83	4.82	4.92	5.15	5.44	5.86	5.67	5.71	4.97	4.99	4.94	5.40	6.88	6.92	6.50
Receivables turnover	8.86	8.09	8.48	7.99	10.82	8.26	8.39	7.94	10.78	8.11	8.43	7.44	9.42	8.40	7.14	7.98	12.40	8.65	7.38	6.63
Payables turnover	10.72	12.50	11.98	12.20	9.08	9.85	9.82	10.67	8.26	10.47	9.33	10.05	8.45	8.31	8.12	9.24	9.45	12.36	12.53	12.47
Working capital turnover	6.89	4.81	6.34	5.71	5.42	4.43	4.37	4.76	5.04	4.39	4.18	4.04	3.59	2.51	2.89	3.57	3.99	4.49	4.84	6.25

Estee Lauder Companies Inc's activity ratios provide insight into how efficiently the company manages its inventory, receivables, payables, and working capital.

The inventory turnover ratio has been relatively consistent over the periods, ranging from 4.82 to 7.10. This suggests that the company effectively turns over its inventory, with higher turnover ratios indicating better efficiency in selling products and managing stock levels.

The receivables turnover ratio fluctuates notably, ranging from 7.14 to 12.40. A higher receivables turnover indicates that the company is collecting its accounts receivable more quickly, potentially reflecting strong credit and collection policies.

The payables turnover ratio ranges from 8.12 to 12.53, showing fluctuations in how quickly the company pays its suppliers. A higher turnover ratio indicates that the company is paying its suppliers more frequently, which could be a sign of good relationships with suppliers or taking advantage of discounts.

The working capital turnover ratio fluctuates between 2.51 and 6.89, reflecting how efficiently the company generates revenue relative to its working capital. Higher turnover ratios suggest that the company efficiently utilizes its working capital to generate sales.

Overall, Estee Lauder Companies Inc's activity ratios demonstrate a mixed performance in managing its operational resources effectively. Monitoring these ratios over time can help identify trends and areas for improvement in the company's operational efficiency.

Average number of days

		Jun 30, 2024	Mar 31, 2024	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
Days of inventory on hand (DOH)	days	51.40	56.26	63.35	68.16	71.74	75.51	75.69	74.14	70.85	67.13	62.31	64.41	63.95	73.39	73.18	73.94	67.64	53.04	52.73	56.16
Days of sales outstanding (DSO)	days	41.19	45.10	43.05	45.70	33.75	44.20	43.50	45.98	33.87	44.99	43.29	49.06	38.77	43.46	51.15	45.77	29.44	42.21	49.44	55.08
Number of days of payables	days	34.03	29.19	30.47	29.93	40.22	37.06	37.17	34.20	44.21	34.87	39.10	36.33	43.19	43.91	44.92	39.52	38.61	29.53	29.13	29.27

Estee Lauder Companies Inc's activity ratios provide insight into the efficiency of the company's operations.

1. Days of Inventory on Hand (DOH): This ratio measures how many days, on average, inventory is held before being sold. Over the past quarters, Estee Lauder has shown a decreasing trend in its DOH, indicating an improvement in managing inventory levels efficiently. The company has successfully reduced the number of days inventory is held, which is a positive sign for liquidity and working capital management.

2. Days of Sales Outstanding (DSO): DSO reflects the average number of days it takes for the company to collect payments from its customers. Estee Lauder has experienced fluctuations in its DSO over the quarters. The company has managed to reduce its DSO significantly in some quarters, indicating efficient credit management and timely collection from customers. However, there have also been periods where DSO increased, suggesting potential challenges in collecting receivables promptly.

3. Number of Days of Payables: This ratio represents the average number of days it takes for the company to pay its suppliers. Estee Lauder has shown variability in its payables turnover over the quarters. The company has sometimes increased its payables turnover, which may indicate that it is taking longer to pay its suppliers. However, there have also been instances where the payables turnover decreased, suggesting faster payment to suppliers.

In summary, Estee Lauder Companies Inc has demonstrated improvements in managing its inventory efficiently, maintaining a balance in collecting payments from customers, and managing payments to suppliers effectively. Monitoring these activity ratios can provide valuable insights into the company's operational performance and efficiency.

Long-term

	Jun 30, 2024	Mar 31, 2024	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
Fixed asset turnover	4.88	4.79	4.61	4.91	4.94	5.20	5.57	6.45	6.63	7.19	7.15	7.15	7.03	6.92	6.57	6.96	7.20	7.63	7.88	7.53
Total asset turnover	0.71	0.66	0.64	0.67	0.67	0.69	0.78	0.86	0.84	0.84	0.79	0.78	0.73	0.73	0.72	0.81	0.83	0.87	0.92	0.99

Estee Lauder Companies Inc's long-term activity ratios provide insight into how efficiently the company is utilizing its assets to generate sales.

- Fixed asset turnover has shown a fluctuating trend over the past few quarters, ranging between 4.61 and 7.88. This ratio measures the company's ability to generate sales from its fixed assets, such as property, plant, and equipment. The higher the ratio, the better, as it signifies that the company is effectively utilizing its fixed assets to generate revenue. Estee Lauder's fixed asset turnover has generally been on an upward trend, indicating increasing efficiency in utilizing its fixed assets for sales generation.

- Total asset turnover has also fluctuated, ranging between 0.64 and 0.99. This ratio measures how well the company is generating sales from all its assets, including both fixed and current assets. A higher total asset turnover indicates that the company is generating more revenue per dollar of assets. The trend for Estee Lauder's total asset turnover has been somewhat inconsistent, with periods of increase and decrease. However, the ratio has generally been within a reasonable range.

Overall, based on the long-term activity ratios, Estee Lauder Companies Inc has shown positive signs of efficiency in utilizing its assets to generate sales, particularly in terms of fixed asset turnover. However, the company may need to focus on improving the consistency of its total asset turnover to ensure optimal utilization of all its assets in driving revenue growth.