Graham Holdings Co (GHC)

Short-term

Turnover ratios

In analyzing the activity ratios of Graham Holdings Co based on the provided data, we observe the following trends:

1. Inventory Turnover: The inventory turnover for Graham Holdings Co has been gradually declining from 17.40 in March 2020 to 11.45 in December 2024. This indicates that the company is taking longer to sell its inventory, which could potentially lead to higher carrying costs or obsolete inventory.

2. Receivables Turnover: Unfortunately, there is no data available for the receivables turnover ratio. This ratio would have provided insights into how efficiently the company is collecting on its credit sales.

3. Payables Turnover: Similarly, data is missing for the payables turnover ratio, which would have shown how quickly the company pays its suppliers. This ratio is important for managing cash flow and vendor relationships.

4. Working Capital Turnover: The working capital turnover ratio fluctuated over the period, ranging from 3.15 in March 2021 to 7.86 in March 2023. A higher turnover ratio generally indicates efficient utilization of working capital to generate sales. The company's ratio showed some volatility but overall remained relatively stable.

Overall, based on the available data, it is evident that Graham Holdings Co needs to focus on improving its inventory turnover and maintaining efficient working capital utilization to sustain and enhance its operational efficiency in the future.

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Average number of days

Based on the provided data for Graham Holdings Co, we can analyze its activity ratios as follows:

1. Days of Inventory on Hand (DOH):
- The DOH measures how many days, on average, a company holds its inventory before selling it.
- Graham Holdings Co's DOH has been fluctuating over the periods, ranging from a low of 17.81 days on September 30, 2021, to a high of 36.92 days on March 31, 2024.
- A generally increasing trend in DOH may indicate potential issues with inventory management or declining sales efficiency, while a decreasing trend could suggest improved inventory turnover.

2. Days of Sales Outstanding (DSO):
- Unfortunately, the data provided for DSO is missing for all periods, making it impossible to analyze Graham Holdings Co's efficiency in collecting receivables.
- The DSO ratio typically measures the average number of days it takes a company to collect revenue after a sale, indicating how effectively the company manages its accounts receivable.

3. Number of Days of Payables:
- Similarly, the data for the number of days of payables is not available, preventing an analysis of Graham Holdings Co's payment practices towards suppliers.
- This ratio assesses how long a company takes to pay its outstanding bills, influencing its working capital management and relationships with vendors.

In conclusion, based on the data provided, we can only assess Graham Holdings Co's inventory holding period but lack information on its accounts receivable and accounts payable turnover. Monitoring and understanding these activity ratios are essential for evaluating the company's operating efficiency, liquidity, and overall financial performance.

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Long-term

The Fixed Asset Turnover ratio for Graham Holdings Co has shown some fluctuations over the years, ranging from a high of 8.24 during June 30, 2023, to a low of 3.69 during June 30, 2021. The ratio measures how efficiently the company is utilizing its fixed assets to generate revenue. Generally, a higher fixed asset turnover ratio indicates better utilization of fixed assets.

On the other hand, the Total Asset Turnover ratio has also varied over time, with a peak of 0.64 during June 30, 2023, and a low of 0.43 during December 31, 2021. This ratio reflects the company's ability to generate sales from its total assets. A higher total asset turnover ratio signifies that the company is efficiently utilizing its assets to generate revenue.

Analyzing both ratios together can provide insights into how effectively Graham Holdings Co is managing its assets to generate sales. The fluctuations in these ratios should be further assessed in conjunction with other financial metrics to gain a comprehensive understanding of the company's long-term asset management efficiency.