GameStop Corp (GME)
Activity ratios
Short-term
Turnover ratios
| Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 6.29 | 6.67 | 5.10 | 6.36 | 5.30 |
| Receivables turnover | 57.94 | 38.51 | 42.60 | 48.34 | 45.57 |
| Payables turnover | 12.28 | 8.57 | 9.90 | 11.21 | 11.97 |
| Working capital turnover | 5.07 | 6.02 | 4.83 | 24.41 | 16.33 |
The activity ratios of GameStop Corp provide insight into the company's efficiency in managing its key operating assets and liabilities.
1. Inventory turnover has shown a generally consistent trend over the past five years, indicating that GameStop effectively sells and replenishes its inventory. The slight decrease in 2022 compared to 2023 may suggest a potential need to manage inventory levels more effectively.
2. Receivables turnover has significantly improved from 2021 to 2023, reflecting the company's ability to collect outstanding receivables more efficiently. This signals a positive trend in managing customer credit and collections.
3. Payables turnover has also demonstrated a consistent increase over the years, showing that GameStop is taking longer to pay its suppliers. This may indicate improved payment terms negotiated with suppliers or potential delays in settling payables.
4. The working capital turnover ratio measures how efficiently working capital is being used to generate sales. The sharp decrease in 2021 followed by a significant increase in 2022 and 2023 indicates fluctuating efficiency in utilizing working capital. Such fluctuations should be further investigated to understand the underlying causes.
Overall, GameStop Corp's activity ratios suggest mixed performance in managing its operating assets and liabilities, with notable improvements in receivables turnover and working capital turnover, while inventory turnover and payables turnover show some variability over the years. Further analysis and comparison with industry benchmarks are recommended to assess GameStop's performance in these areas thoroughly.
Average number of days
| Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 58.03 | 54.72 | 71.62 | 57.41 | 68.85 |
| Days of sales outstanding (DSO) | days | 6.30 | 9.48 | 8.57 | 7.55 | 8.01 |
| Number of days of payables | days | 29.72 | 42.57 | 36.87 | 32.57 | 30.50 |
Days of inventory on hand (DOH) measures how many days it takes for GameStop to sell its inventory. A decreasing trend in DOH over the years, from 71.62 days in 2022 to 58.03 days in 2024, suggests that the company is managing its inventory more efficiently, turning over stock more quickly.
Days of sales outstanding (DSO) reflects the average number of days it takes for GameStop to collect payment after a sale. The decreasing trend in DSO, from 9.48 days in 2023 to 6.30 days in 2024, indicates that GameStop is improving its collection process, converting sales into cash at a faster rate.
Number of days of payables shows the average number of days GameStop takes to pay its suppliers. A declining trend in this ratio, from 42.57 days in 2023 to 29.72 days in 2024, implies that the company is taking longer to pay its bills, which may suggest improved liquidity management or better negotiation terms with suppliers.
Overall, the trends in GameStop's activity ratios indicate that the company is managing its operations more efficiently, with faster inventory turnover, quicker collection of receivables, and potentially better control over payment terms with suppliers.
See also:
GameStop Corp Short-term (Operating) Activity Ratios
Long-term
| Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 55.56 | 43.42 | 36.74 | 25.30 | 23.44 |
| Total asset turnover | 1.95 | 1.90 | 1.72 | 2.06 | 2.29 |
GameStop Corp's long-term activity ratios indicate the company's efficiency in utilizing its assets to generate sales. The fixed asset turnover has shown an increasing trend over the past five years, suggesting that GameStop has been able to generate more sales for each dollar invested in fixed assets. This improvement signifies enhanced operational efficiency and asset utilization.
On the other hand, the total asset turnover ratio has fluctuated over the same period. While the ratio was relatively stable in 2020 and 2021, it decreased in 2022 and then increased in 2023 and 2024. These fluctuations may indicate changes in the company's asset management strategies or shifts in its business operations.
Overall, GameStop Corp's long-term activity ratios reflect improving efficiency in utilizing fixed assets to generate sales, but the total asset turnover ratio has shown some volatility in recent years, possibly due to changing business conditions or strategic decisions.