Six Flags Entertainment Corporation (FUN)

Short-term

Turnover ratios

Based on the provided data, we will analyze the activity ratios of Six Flags Entertainment Corporation:

1. Inventory Turnover:
- The inventory turnover ratio measures how efficiently a company manages its inventory. A higher ratio indicates faster sales of inventory.
- Six Flags' inventory turnover has shown a significant increase over the years, from 0.59 in 2020 to 14.12 in 2024. This indicates that Six Flags has been able to sell its inventory much quicker in recent years.

2. Receivables Turnover:
- Receivables turnover ratio measures how many times a company collects its accounts receivable in a specific period. A higher ratio is generally better.
- The data provided does not include receivables turnover for years 2020 to 2023, but in 2024, the receivables turnover was 16.43. This suggests that Six Flags was able to collect its accounts receivable efficiently in that year.

3. Payables Turnover:
- Payables turnover ratio indicates how many times a company pays its suppliers in a given period. A higher ratio usually indicates that the company is managing its payables efficiently.
- Similar to receivables turnover, no data for payables turnover was provided until 2024, where it was noted as 9.38. This implies that Six Flags managed its payables effectively in 2024.

4. Working Capital Turnover:
- The working capital turnover ratio measures how efficiently a company is using its working capital to generate sales revenue. A higher ratio is generally preferred.
- The data shows a working capital turnover of 0.71 in 2020, but no data for the subsequent years. This ratio indicates that Six Flags generated $0.71 in revenue for every dollar of working capital in 2020.

In summary, Six Flags Entertainment Corporation has shown improvements in inventory turnover and efficiency in managing payables based on the provided data. However, data limitations make it challenging to provide a comprehensive analysis for receivables turnover and working capital turnover for the years beyond 2020.

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Average number of days

The Days of Inventory on Hand (DOH) ratio for Six Flags Entertainment Corporation has shown a significant improvement over the years, decreasing from 619.12 days in 2020 to 25.84 days in 2024. This indicates that the company has been more efficient in managing its inventory levels and turning over its inventory faster.

The Days of Sales Outstanding (DSO) ratio was not available for the years provided except for 2024, where it was 22.21 days. A lower DSO indicates that the company is collecting its accounts receivable more quickly, which can improve cash flow and liquidity.

The Number of Days of Payables ratio was not available for the years provided except for 2024, where it was 38.91 days. A higher number of days of payables indicates that the company is taking longer to pay its suppliers, which can help improve cash flow by extending payment terms.

Overall, based on the available data, Six Flags Entertainment Corporation has shown improvements in its activity ratios, indicating more efficient management of inventory, accounts receivable, and accounts payable over the years.

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Long-term

The fixed asset turnover ratio for Six Flags Entertainment Corporation has shown improvement over the years, increasing from 0.10 in December 31, 2020, to 1.15 in December 31, 2022, before declining to 0.63 in December 31, 2024. This indicates that the company has become more efficient in generating revenue from its fixed assets, peaking in 2022 but regressing slightly in 2024.

On the other hand, the total asset turnover ratio has also exhibited a similar trend, with an increase from 0.07 in December 31, 2020, to 0.81 in December 31, 2022. However, this ratio remained relatively stable in the subsequent years, with values of 0.79 in December 31, 2023 and 0.30 in December 31, 2024. This suggests that the company's ability to generate sales from its total assets improved significantly but declined notably in 2024.

Overall, the trend in both fixed asset turnover and total asset turnover ratios indicates fluctuations in the company's efficiency in utilizing both fixed and total assets to generate sales. Continued monitoring and analysis of these ratios will be key to understanding the company's operational performance and efficiency in the long term.