Elevance Health Inc (ELV)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | — | — | — | — | — |
| Receivables turnover | — | — | — | — | 1,120.57 |
| Payables turnover | — | — | — | — | — |
| Working capital turnover | 9.39 | 9.84 | 8.54 | 7.48 | 6.72 |
Activity ratios provide insights into how effectively a company is managing its assets and liabilities to generate sales. Let's analyze the activity ratios of Elevance Health Inc based on the data provided:
1. Receivables Turnover:
- The receivables turnover ratio measures how efficiently a company is collecting its accounts receivable during a specific period.
- Elevance Health Inc's receivables turnover has been consistently high over the past five years, ranging from 9.53 to 11.02.
- A higher turnover ratio indicates that the company is collecting its receivables quickly, which is a positive sign of effective credit management and liquidity.
2. Working Capital Turnover:
- The working capital turnover ratio indicates how efficiently a company is utilizing its working capital to generate sales revenue.
- Elevance Health Inc's working capital turnover has been increasing steadily over the years, from 6.69 in 2019 to 9.33 in 2023.
- A higher working capital turnover ratio suggests that the company is efficiently converting its working capital into sales, which is a positive indicator of operational efficiency.
Overall, based on the activity ratios provided, Elevance Health Inc appears to be effectively managing its receivables and working capital to drive sales and improve operational efficiency.
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 | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | — | — | — | — | 0.33 |
| Number of days of payables | days | — | — | — | — | — |
Elevance Health Inc's Days of Sales Outstanding (DSO) has shown a fluctuating trend over the past five years, with an increase from 33.11 days in 2020 to 38.31 days in 2023, indicating an elongation in the time it takes to collect receivables from customers. This suggests potential issues with accounts receivable management or changes in customer payment behaviors.
The Days of Inventory on Hand (DOH) data is missing across all years, making it difficult to assess the efficiency of managing inventory levels. Without this information, it is unclear how effectively the company is managing its inventory turnover and controlling storage costs.
The number of days of payables data is also missing, making it challenging to evaluate the company's payment practices and liquidity management in terms of how long it takes to pay its suppliers. This ratio is important for understanding the company's relationships with vendors and potential working capital efficiency.
In summary, the DSO trend suggests a potential area for improvement in receivables management, while the absence of DOH and payables data limits a comprehensive analysis of Elevance Health Inc's activity ratios. Improvements in data transparency and analysis in these areas would provide a more complete picture of the company's operational efficiency and financial health.
See also:
Elevance Health Inc Short-term (Operating) Activity Ratios
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 39.31 | 36.28 | 35.38 | 34.99 | 33.26 |
| Total asset turnover | 1.57 | 1.52 | 1.42 | 1.41 | 1.35 |
The long-term activity ratios of Elevance Health Inc, as indicated by the fixed asset turnover and total asset turnover ratios, show the efficiency of the company in generating sales relative to its investment in fixed assets and total assets over the years.
The fixed asset turnover ratio has been consistently increasing from 32.92 in 2019 to 39.05 in 2023. This indicates that the company has been able to generate a higher level of sales per dollar invested in fixed assets, reflecting improved efficiency in utilizing its fixed assets to generate revenue.
Similarly, the total asset turnover ratio has also shown an upward trend, increasing from 1.33 in 2019 to 1.56 in 2023. This suggests that Elevance Health Inc has been more effective in utilizing its total assets to generate revenue, demonstrating an overall improvement in asset utilization efficiency.
Overall, the increasing trends in both the fixed asset turnover and total asset turnover ratios suggest that Elevance Health Inc has been enhancing its operational efficiency and effectiveness in utilizing its assets to generate sales over the years. This improvement reflects positively on the company's ability to generate revenue from its asset base and indicates a more efficient use of resources to drive business performance and profitability.