Gogo Inc (GOGO)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 1.01 | 2.10 | 2.75 | 3.01 | 3.00 |
| Receivables turnover | — | — | — | — | — |
| Payables turnover | — | — | — | — | — |
| Working capital turnover | 3.15 | 1.64 | 1.69 | 5.47 | 3.64 |
Gogo Inc's inventory turnover has been relatively stable over the past five years, ranging from 2.10 to 3.01. This indicates that the company is efficiently managing its inventory levels and turning over its inventory multiple times during the year. However, there was a notable decrease in inventory turnover from 2022 to 2024, which may suggest potential issues with inventory management or slowing sales.
The receivables turnover ratio for Gogo Inc was not available for any of the years provided. This lack of data makes it difficult to assess the effectiveness of the company in collecting payments from its customers promptly.
Similarly, the payables turnover ratio was unavailable for all years, preventing an analysis of how quickly the company is paying its suppliers.
In terms of working capital turnover, the company's performance has been inconsistent, with the ratio fluctuating from 1.64 to 5.47. A higher working capital turnover ratio indicates that the company is generating more sales revenue from its working capital, which can be a positive sign of operational efficiency. However, the significant variability in this ratio over the years may warrant further investigation into the company's working capital management practices.
Average number of days
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 360.92 | 173.47 | 132.93 | 121.35 | 121.62 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
Based on the provided data for Gogo Inc's activity ratios, we can analyze the following:
1. Days of Inventory on Hand (DOH):
- The Days of Inventory on Hand indicates how many days, on average, Gogo Inc holds its inventory before it is sold.
- Gogo Inc's inventory holding periods show a consistent increase from 121.62 days in 2020 to a significant 360.92 days in 2024.
- The upward trend in DOH may imply that Gogo Inc is struggling to turn over its inventory efficiently, possibly leading to increased carrying costs and inventory obsolescence risk.
2. Days of Sales Outstanding (DSO):
- The Days of Sales Outstanding measures how long it takes for Gogo Inc to collect payments from its customers.
- The data provided did not have information on DSO for the years 2020 to 2024, suggesting a lack of insight into Gogo Inc's accounts receivable turnover efficiency.
- Without DSO data, it is challenging to evaluate Gogo Inc's effectiveness in managing its accounts receivable and cash collection cycle.
3. Number of Days of Payables:
- The Number of Days of Payables represents how long Gogo Inc takes on average to pay its suppliers.
- Similarly, the data provided did not include information on the days of payables for the years 2020 to 2024, making it difficult to assess Gogo Inc's payment terms and relationships with its suppliers.
- Understanding the payables turnover could provide insights into Gogo Inc's liquidity position and working capital management strategies.
In conclusion, while the Days of Inventory on Hand data suggests potential inventory management challenges for Gogo Inc, the absence of Days of Sales Outstanding and Number of Days of Payables data limits a comprehensive analysis of the company's overall activity and efficiency in managing its operating cycle. Further details on DSO and payables turnover are essential to gain a holistic view of Gogo Inc's working capital management practices.
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | — | — | 2.25 | 5.27 | 4.25 |
| Total asset turnover | 0.36 | 0.51 | 0.53 | 0.52 | 0.40 |
The fixed asset turnover ratio for Gogo Inc has shown a positive trend from 4.25 in 2020 to 5.27 in 2021, indicating that the company is generating more revenue per dollar invested in fixed assets. However, the ratio dropped significantly to 2.25 in 2022, which may suggest potential issues with asset utilization or sales. The absence of data for 2023 and 2024 makes it difficult to assess the trend further.
In contrast, the total asset turnover ratio has generally improved over the years, from 0.40 in 2020 to 0.52 in 2021 and further to 0.53 in 2022 before declining slightly to 0.51 in 2023 and then dropping to 0.36 in 2024. This ratio indicates how efficiently the company is using its total assets to generate sales. The declining trend in 2023 and 2024 may suggest inefficiencies in asset utilization or a decrease in sales relative to the size of the asset base.
Overall, while the company's fixed asset turnover has been volatile, the total asset turnover has shown improvement initially but declined in the later years. Further analysis would be necessary to understand the underlying reasons for these fluctuations in asset turnover ratios.