National Beverage Corp (FIZZ)

Short-term

Turnover ratios

The activity ratios of National Beverage Corp show the company's efficiency in managing its inventory, receivables, payables, and working capital over the past five years.

1. Inventory turnover has generally improved, indicating that the company is selling its inventory more frequently each year. The higher the ratio, the better the company is at managing its inventory levels.

2. Receivables turnover has fluctuated over the years, but it remains relatively stable. This ratio measures how quickly the company collects its outstanding receivables. A higher ratio indicates that the company is efficient in collecting payments from its customers.

3. Payables turnover has shown variations, but the trend seems to suggest a slight improvement in the company's ability to manage its payables. A higher payables turnover ratio indicates that the company is paying its suppliers more quickly.

4. Working capital turnover has fluctuated significantly over the years, indicating changes in the company's efficiency in generating sales relative to its working capital. A higher ratio implies that the company is using its working capital more effectively to generate sales.

Overall, National Beverage Corp's activity ratios reflect improvements in inventory turnover and working capital turnover, while receivables and payables turnover have shown some fluctuations. These ratios provide valuable insights into the company's operational efficiency and working capital management.

---

Average number of days

To analyze the activity ratios of National Beverage Corp, we will focus on the Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Number of Days of Payables.

1. Days of Inventory on Hand (DOH):
- In 2024, the DOH decreased to 40.46 days from the previous year's 44.01 days, indicating that the company held inventory for a shorter period before it was sold.
- This reduction in inventory holding period suggests improved inventory management efficiency, potentially leading to lower holding costs and better cash flow utilization.

2. Days of Sales Outstanding (DSO):
- The DSO in 2024 was 31.50 days, slightly lower than the previous year's 32.65 days, indicating that the company collected receivables more quickly.
- A lower DSO signifies improved receivables management, faster conversion of credit sales into cash, and reduced credit risk exposure.

3. Number of Days of Payables:
- The number of days of payables in 2024 stood at 37.44 days, down from 40.02 days in the previous year, meaning the company took fewer days to pay its suppliers.
- A decrease in the payables period may suggest that the company is managing its payables more efficiently, potentially maintaining better supplier relationships and leveraging cash flow effectively.

Overall, the downward trend in DOH and DSO, along with a decrease in the number of days of payables, indicates that National Beverage Corp has been enhancing its working capital management and operational efficiency in inventory, receivables, and payables cycles. These improvements suggest a positive impact on the company's liquidity, cash flow, and overall financial performance.

---

Long-term

National Beverage Corp's long-term activity ratios provide insights into how effectively the company utilizes its fixed assets and total assets to generate revenues.

1. Fixed Asset Turnover:
- The fixed asset turnover ratio has been relatively stable over the past five years, ranging from 7.46 to 8.29.
- This indicates that the company generates between $7.46 and $8.29 in revenue for every dollar invested in fixed assets.
- The consistent high turnover signifies that National Beverage Corp efficiently utilizes its fixed assets to generate sales, showing operational efficiency and effective asset management.

2. Total Asset Turnover:
- The total asset turnover ratio fluctuates significantly over the years, ranging from 1.54 to 2.43.
- A higher total asset turnover implies that the company generates more revenue per dollar invested in total assets.
- While the ratio peaked in 2022 at 2.43, it decreased to 1.55 by 2024, indicating a potential decline in the efficiency of asset utilization or changes in the asset composition.

In conclusion, National Beverage Corp maintains a strong performance in utilizing its fixed assets efficiently and generating revenue, as reflected in the fixed asset turnover ratio. However, the fluctuation in the total asset turnover ratio suggests varying levels of efficiency in utilizing all assets to generate sales over the years.