H B Fuller Company (FUL)

Short-term

Turnover ratios

The activity ratios of H.B. Fuller Company indicate its efficiency in managing inventory, receivables, payables, and working capital. The inventory turnover has been consistent at around 5.66x for the past two years, suggesting that the company efficiently sells and replenishes its inventory. The stable receivables turnover, averaging around 5.60x, reflects the company's ability to collect outstanding balances effectively.

Meanwhile, the payables turnover has shown some fluctuation, ranging from 4.86x to 6.99x over the last five years, indicating varying levels of efficiency in paying off its short-term obligations. The working capital turnover has also demonstrated fluctuations, with an average of 6.07x, suggesting changes in the company's efficiency in generating sales relative to its working capital.

Overall, the company's activity ratios reflect reasonably effective management of inventory, receivables, payables, and working capital over the past five years. However, the fluctuations in payables turnover and working capital turnover may warrant further investigation to understand the underlying factors impacting these ratios.

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Average number of days

Days of Inventory on Hand (DOH) measures the average number of days it takes for H.B. Fuller Company to sell its inventory. The trend over the past five years shows a relatively stable performance, with inventory being held for around 60-70 days before being sold.

Days of Sales Outstanding (DSO) reflects the average number of days it takes for the company to collect payment after making a sale. The DSO has fluctuated over the years, with a peak in 2021 and a slight decrease in 2023 compared to the previous year.

Number of Days of Payables indicates the average number of days it takes for H.B. Fuller to pay its suppliers. The trend suggests that the company has been taking longer to pay its suppliers, with a notable increase in 2021 and 2023 compared to the previous years.

Overall, the company has maintained a stable inventory turnover, saw fluctuations in the collection period for its sales, and extended the number of days it takes to settle its payables, which may have implications on working capital management and supplier relationships.

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Long-term

The long-term activity ratios of H.B. Fuller Company, as indicated by the fixed asset turnover and total asset turnover, reveal important insights into the efficiency and utilization of the company's assets over the past five years.

The fixed asset turnover ratio measures how effectively the company generates sales from its fixed assets. In this case, H.B. Fuller Company's fixed asset turnover has fluctuated over the years, with a high of 5.11 in 2022 and a low of 4.16 in 2020. The 2023 ratio of 4.26 suggests that for each dollar of fixed assets, the company generated $4.26 in revenue, indicating efficient utilization of fixed assets to generate sales.

The total asset turnover ratio reflects the efficiency of the company in using all its assets to generate sales. H.B. Fuller Company's total asset turnover has also seen fluctuations, with a high of 0.84 in 2022 and a low of 0.69 in 2020. The 2023 ratio of 0.74 signifies that the company generated $0.74 in sales for each dollar of assets, highlighting a consistent ability to efficiently utilize total assets to generate revenue.

Overall, the trends in both fixed asset turnover and total asset turnover ratios indicate that H.B. Fuller Company has maintained a relatively efficient utilization of its assets to generate sales over the past five years, with minor fluctuations possibly reflecting shifts in the operational and investment activities of the company.