Exelon Corporation (EXC)

Short-term

Turnover ratios

Exelon Corp.'s activity ratios indicate the efficiency at which the company manages its resources and operations.

1. Inventory turnover:
- Exelon Corp.'s inventory turnover has shown a consistent improvement from 8.77 in 2019 to 10.29 in 2023. This indicates that the company is selling its inventory more frequently within the year, which is generally positive as it reduces the risk of obsolete inventory and ties up less cash in inventory.

2. Receivables turnover:
- The receivables turnover ratio for Exelon Corp. has fluctuated over the years, with a peak in 2021 at 7.09. A higher ratio suggests that the company is collecting its accounts receivables more efficiently, translating into a shorter time for receiving cash from its credit sales.

3. Payables turnover:
- Exelon Corp.'s payables turnover has varied, but with an upward trend from 2019 to 2023. A higher payables turnover ratio indicates that the company is paying its suppliers more quickly, which can improve vendor relationships and potentially allow for discounts on early payments.

4. Working capital turnover:
- The data for working capital turnover is not provided, which limits the analysis of how efficiently Exelon Corp. is utilizing its working capital to generate sales. This ratio would typically measure how effectively the company is using its working capital to support its operations.

Overall, Exelon Corp. has shown improvements in its inventory turnover and payables turnover ratios, indicating enhanced efficiency in managing inventory and payments to suppliers. The fluctuations in the receivables turnover ratio suggest varying effectiveness in collecting receivables over the years.

---

Average number of days

Activity ratios provide insights into how efficiently a company manages its assets and operations. Let's analyze the activity ratios of Exelon Corp. based on the provided data:

1. Days of Inventory on Hand (DOH):
- Exelon's DOH has been fluctuating over the past five years, ranging from 35.48 days to 44.56 days.
- A lower DOH indicates that Exelon is efficiently managing its inventory levels, turning over inventory quickly. In 2023, the DOH decreased compared to the previous year, which suggests improved inventory management efficiency.

2. Days of Sales Outstanding (DSO):
- Exelon's DSO has also varied over the years, from 51.14 days to 68.13 days.
- DSO measures how quickly the company collects payments from customers. A lower DSO indicates efficient accounts receivable management. In 2023, the DSO decreased, indicating that Exelon may have improved its collection process, translating to quicker cash inflows.

3. Number of Days of Payables:
- Exelon's days of payables have shown significant fluctuations, ranging from 83.97 days to 198.95 days.
- A higher number of days of payables implies that Exelon takes longer to pay its suppliers, potentially indicating favorable payment terms. However, excessively long payables can strain supplier relationships. In 2023, the number of days of payables decreased significantly compared to the previous year, which could indicate improved liquidity or negotiation with suppliers.

In conclusion, the analysis of Exelon Corp.'s activity ratios suggests that the company has made progress in managing its inventory levels, collecting payments, and managing payables efficiently in 2023 compared to previous years. Improvements in these areas can positively impact the company's working capital and overall financial performance.

---

Long-term

Exelon Corp.'s long-term activity ratios, specifically the fixed asset turnover and total asset turnover, have shown a fluctuating trend over the past five years.

The fixed asset turnover, which measures how effectively the company is utilizing its fixed assets to generate revenue, decreased from 0.43 in 2021 to 0.30 in 2023. This indicates a decrease in the company's ability to generate sales from its fixed assets over the period. However, it's important to note that the ratio has been relatively stable around the 0.30 to 0.43 range, suggesting that Exelon has been maintaining a consistent level of efficiency in utilizing its fixed assets.

On the other hand, the total asset turnover, which reflects how efficiently the company is using all its assets to generate revenue, has also shown a decreasing trend from 0.28 in 2019 to 0.21 in 2023. This indicates a decline in the company's overall efficiency in generating sales from its total assets. The decreasing trend in total asset turnover may raise concerns regarding Exelon's asset utilization efficiency and its ability to effectively generate revenue from its total asset base.

In conclusion, while Exelon Corp. has shown some fluctuations in its long-term activity ratios over the past five years, particularly in fixed asset turnover and total asset turnover, the company should evaluate its asset management strategies to improve efficiency in generating revenue from its assets.