H B Fuller Company (FUL)

Short-term

Turnover ratios

The inventory turnover ratio for H B Fuller Company has shown fluctuations over the periods analyzed, ranging from 4.64 to 6.29. A higher inventory turnover ratio indicates that the company is selling its products more efficiently.

The receivables turnover ratio has also varied, with values between 5.18 and 6.68. This ratio reflects the company's effectiveness in collecting outstanding receivables, with higher values suggesting better efficiency.

The payables turnover ratio has shown a declining trend, ranging from 4.78 to 7.37. A lower payables turnover ratio may indicate that the company is taking more time to pay its suppliers, which could impact cash flow management.

The working capital turnover ratio has displayed some fluctuations, with values between 5.15 and 6.77. This ratio measures how effectively the company is using its working capital to generate sales, with higher values indicating greater efficiency in this aspect.

Overall, these activity ratios provide insights into H B Fuller Company's operational efficiency, inventory management, receivables collection, payables management, and utilization of working capital to drive sales.

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Average number of days

H B Fuller Company's activity ratios provide insights into how efficiently the company manages its inventory, receivables, and payables.

1. Days of Inventory on Hand (DOH):
- The DOH indicates the average number of days it takes for the company to sell its inventory.
- The trend shows fluctuations over the years, with a peak of 78.64 days in February 2022 and a low of 58.01 days in November 2020.
- In recent periods, DOH has stabilized around 70 days, suggesting consistent inventory management.

2. Days of Sales Outstanding (DSO):
- DSO represents the average number of days it takes the company to collect on its sales.
- The DSO has shown varying patterns, with a downward trend from 70.43 days in May 2021 to 57.10 days in November 2024.
- The company has improved its credit management efficiency by reducing the DSO over the years.

3. Number of Days of Payables:
- This ratio signifies the average number of days the company takes to pay its suppliers.
- The trend shows some fluctuations, with an increase seen in February 2022, followed by a decrease and stabilization around 60-70 days.
- H B Fuller has maintained a balance in managing its payables efficiently without causing strain on its cash flow.

Overall, H B Fuller has demonstrated effective management of its working capital components, with relatively stable inventory levels, decreasing DSO, and maintained payables turnover, indicating sound operational efficiency.

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Long-term

The Fixed Asset Turnover ratio for H B Fuller Company has shown a consistent improvement over the years, starting at 4.53 in February 2020 and peaking at 5.22 in August 2022. However, there has been a slight decline since then, with the ratio standing at 4.05 in November 2024. This indicates that the company is generating $4.05 of revenue for every dollar invested in fixed assets.

On the other hand, the Total Asset Turnover ratio has displayed some fluctuations but has generally trended upwards, from 0.71 in February 2020 to 0.72 in November 2024. This suggests that the company is becoming more efficient in generating sales from its total assets, with the ability to generate revenue of $0.72 for every dollar of assets.

Overall, the trends in both ratios indicate that H B Fuller Company is effectively utilizing its assets, both fixed and total, to generate revenue. However, management should monitor the fixed asset turnover ratio to ensure that the company is efficiently utilizing its fixed assets to support revenue growth.