FirstEnergy Corporation (FE)

Short-term

Turnover ratios

FirstEnergy Corporation's activity ratios provide insights into how efficiently the company manages its resources.

1. Inventory Turnover: The inventory turnover ratio measures how many times a company sells and replaces its inventory during a specific period. From 2020 to 2024, FirstEnergy's inventory turnover ratio has fluctuated. The highest turnover ratio was 13.25 in 2021, indicating that the company sold and replaced its inventory more frequently that year, possibly due to increased efficiency in inventory management. However, the ratio decreased in the following years, reaching 7.97 in 2024, which suggests a slowdown in inventory turnover.

2. Receivables Turnover: The absence of data for receivables turnover indicates that specific information on how efficiently FirstEnergy collects on its accounts receivable is not available. A higher turnover ratio in this area generally indicates that the company is collecting payments from customers promptly.

3. Payables Turnover: Similarly, the lack of data for payables turnover indicates that specific information on how effectively the company manages its trade payables is unavailable. A higher turnover ratio in this aspect typically suggests that the company is paying off its short-term obligations quickly.

4. Working Capital Turnover: The working capital turnover ratio signifies how much revenue is generated per dollar of working capital over a specific period. The absence of data for this ratio implies that a year-over-year analysis of how efficiently FirstEnergy utilizes its working capital is not feasible.

In conclusion, while the inventory turnover ratio reveals fluctuations in FirstEnergy's inventory management efficiency, the absence of data on receivables turnover, payables turnover, and working capital turnover limits the comprehensive analysis of the company's overall efficiency in managing its assets and liabilities.

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Average number of days

First, let's look at the Days of Inventory on Hand (DOH) for FirstEnergy Corporation over the years:

- In 2020, the company had 37.69 days of inventory on hand, indicating that it took approximately 37.69 days for the company to sell its inventory.
- This number decreased to 27.55 days in 2021, suggesting that the company was able to sell its inventory at a faster rate.
- In 2022, the DOH slightly increased to 33.46 days, indicating a slight slowdown in inventory turnover.
- By 2023, the DOH further increased to 40.22 days, suggesting that the company was taking longer to sell its inventory.
- The trend continued in 2024, with the DOH rising to 45.79 days, indicating a significant increase in the time it took to sell inventory.

Next, let's analyze the Days of Sales Outstanding (DSO) and Number of Days of Payables:

- The data does not provide specific values for DSO or the Number of Days of Payables for any of the years, as they are marked as "— days" for each year.
- Typically, a lower DSO value is favorable as it indicates that the company is collecting revenue quicker, while a longer DSO can suggest potential issues with collecting accounts receivable in a timely manner.
- Similarly, analyzing the Number of Days of Payables can provide insight into how long the company takes to pay its suppliers.

In conclusion, based on the provided data, we can see a trend of increasing Days of Inventory on Hand for FirstEnergy Corporation from 2020 to 2024. However, without specific values for Days of Sales Outstanding and Number of Days of Payables, a comprehensive analysis of the company's overall activity ratios regarding accounts receivable and accounts payable efficiency cannot be completed.

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Long-term

FirstEnergy Corporation's long-term activity ratios indicate its efficiency in utilizing its assets to generate revenue over the years.

1. Fixed Asset Turnover: In 2020 and 2021, the fixed asset turnover ratio remained constant at 0.32, suggesting that the company generated $0.32 in revenue for each dollar invested in fixed assets. However, in 2022, the ratio significantly improved to 6.37, indicating a substantial increase in the company's ability to generate revenue from its fixed assets efficiently. Unfortunately, data is missing for 2023 and 2024, making it challenging to assess the continuous trend.

2. Total Asset Turnover: The total asset turnover ratio depicts the company's ability to generate revenue from all its assets. The ratio slightly increased from 0.24 in 2020 to 0.25 in 2021 and further to 0.27 in 2022. However, it decreased to 0.26 in both 2023 and 2024. This indicates that the company may be experiencing some challenges in effectively utilizing its total assets to generate revenue in the latter years.

Overall, while the fixed asset turnover ratio showed a drastic improvement in 2022, the total asset turnover ratio remained relatively stable with a slight decline towards the end of the period. Further analysis and comparison with industry benchmarks would be necessary to gain a deeper understanding of FirstEnergy Corporation's efficiency in asset utilization.