Graco Inc (GGG)

Activity ratios

Short-term

Turnover ratios

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Inventory turnover 2.36 2.29 2.25 2.19 2.28 2.31 2.27 2.26 2.49 2.52 2.63 2.65 2.78 2.72 2.59 2.67 2.88 2.71 2.63 2.61
Receivables turnover 6.19 6.20 5.99 6.11 6.19 5.85 5.55 5.97 6.11 5.92 5.28 5.35 5.24 5.05 5.49 5.90 6.16 5.91 5.69 5.71
Payables turnover 14.33 13.96 13.24 13.57 12.90 10.79 11.97 11.20 12.16 10.52 11.65 12.49 13.64 13.93 15.65 12.01 14.53 14.23 12.63 11.53
Working capital turnover 2.26 2.23 2.38 2.40 2.66 2.49 2.43 2.55 2.32 2.12 2.21 2.15 2.35 2.17 2.13 2.19 3.25 3.38 3.77 4.35

Graco Inc's activity ratios provide insight into the efficiency of the company's operational activities.

1. Inventory Turnover: Graco Inc's inventory turnover ratio has fluctuated over the periods analyzed, ranging from 2.19 to 2.78. The decreasing trend in recent periods may indicate potential issues with managing inventory levels efficiently.

2. Receivables Turnover: The receivables turnover ratio for Graco Inc has varied between 5.05 and 6.20. Generally, a higher turnover ratio indicates more efficient management of accounts receivable, and Graco Inc has maintained relatively consistent performance in this area.

3. Payables Turnover: Graco Inc's payables turnover ratio has been unstable, fluctuating between 10.52 and 15.65. A higher turnover ratio suggests that the company is paying its suppliers more frequently, which can potentially strain cash flows.

4. Working Capital Turnover: The working capital turnover ratio of Graco Inc has shown variability, with values ranging from 2.12 to 4.35. A higher turnover ratio indicates that the company is utilizing its working capital more efficiently to generate sales revenue.

Overall, while Graco Inc has demonstrated relatively stable performance in managing receivables, there are some concerns regarding inventory management and the stability of payables turnover. Further analysis and monitoring of these ratios will be essential to ensure operational efficiency and financial health.

Average number of days

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Days of inventory on hand (DOH) days 154.65 159.05 161.99 166.39 160.24 157.83 160.93 161.56 146.32 144.92 139.05 137.54 131.14 134.04 140.82 136.84 126.84 134.86 138.82 139.98
Days of sales outstanding (DSO) days 58.92 58.91 60.97 59.72 58.92 62.44 65.82 61.09 59.71 61.70 69.10 68.16 69.67 72.22 66.47 61.89 59.28 61.74 64.16 63.87
Number of days of payables days 25.48 26.16 27.57 26.90 28.30 33.81 30.49 32.59 30.02 34.68 31.34 29.23 26.76 26.20 23.32 30.40 25.12 25.65 28.91 31.66

Based on the provided data on Graco Inc's activity ratios, we can observe the following trends:

Days of Inventory on Hand (DOH):
- The trend in 2023 shows a slight increase in the number of days inventory is held on hand from March to December.
- This indicates that Graco Inc is holding inventory for a longer period, which could tie up working capital and potentially impact liquidity.

Days of Sales Outstanding (DSO):
- The DSO has fluctuated throughout the year but has generally remained stable.
- The company has been successful in collecting receivables within a consistent timeframe, which is a positive sign for cash flow management.

Number of Days of Payables:
- The number of days of payables has also shown variability but has generally remained within a certain range.
- There was a notable increase in days of payables from September 2022 to March 2023, indicating a potential extension of payment terms with suppliers.

Overall, the analysis indicates that Graco Inc may be facing challenges in managing its inventory effectively, which could impact its working capital and liquidity position. However, the stable DSO and manageable days of payables suggest a balanced approach to managing receivables and payables. It would be beneficial for the company to review its inventory management practices to optimize working capital efficiency.

Long-term

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Fixed asset turnover 2.96 3.09 3.22 3.44 3.53 3.78 4.01 4.16 4.41 4.61 4.82 4.80 4.70 4.79 4.74 4.86 5.06 5.31 5.78 6.43
Total asset turnover 0.81 0.82 0.81 0.86 0.88 0.87 0.86 0.87 0.81 0.81 0.84 0.83 0.83 0.80 0.79 0.83 0.97 1.00 1.01 1.07

Graco Inc's long-term activity ratios indicate the efficiency of the company in utilizing its assets to generate sales. The fixed asset turnover ratio has been steadily increasing over the past few years, indicating that the company is generating more sales relative to its investment in fixed assets. This suggests that Graco Inc is effectively utilizing its long-term assets to generate revenue.

On the other hand, the total asset turnover ratio fluctuates but remains relatively stable over the same period. While this ratio is lower than the fixed asset turnover, it provides insight into how well the company is using all of its assets to generate sales. The stable total asset turnover ratio suggests that Graco Inc is maintaining a consistent level of efficiency in generating sales based on its total asset base.

Overall, the increasing trend in the fixed asset turnover ratio, coupled with the stable total asset turnover ratio, indicates that Graco Inc is effectively managing its long-term assets and utilizing them efficiently to drive sales growth. However, a closer look at industry benchmarks and trend analysis would provide a more comprehensive assessment of the company's long-term activity performance.