Granite Construction Incorporated (GVA)

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 33.72 35.82 35.15 32.02 35.57 31.34 33.38 37.87 47.60 48.30 57.79 57.91 61.32 36.21 34.43 36.64 40.13 37.16 34.12 34.75
Receivables turnover 11.64 7.91 8.90 13.74 11.71 8.61 10.29 15.29 13.05 9.07 11.43 15.55 13.82 9.22 10.31 12.37 10.74 8.26 10.31 15.36
Payables turnover 8.58 6.92 8.47 10.62 9.24 6.40 7.91 9.87 9.10 9.41 11.52 14.18 11.92 9.60 10.09 11.59 8.90 8.87 11.46 15.57
Working capital turnover 11.36 9.21 9.08 10.44 9.88 10.19 9.25 9.12 8.00 10.99 11.99 13.57 11.81 10.69 11.52 12.03 11.00 9.55 10.82 10.96

Granite Construction Inc.'s activity ratios provide insights into the efficiency of the company's operations in managing inventory, receivables, payables, and working capital.

1. Inventory turnover: Granite Construction Inc. has shown relatively consistent inventory turnover over the past eight quarters, ranging from around 29 to 34 times per year. This indicates that the company is effectively managing its inventory levels and quickly selling its products or materials.

2. Receivables turnover: The receivables turnover ratio has varied significantly quarter to quarter, ranging from around 4 to 8 times per year. A higher turnover ratio suggests that the company is collecting its receivables more quickly, which is crucial for maintaining cash flow and liquidity.

3. Payables turnover: Granite Construction Inc. has demonstrated consistent payables turnover ratios between approximately 6 to 10 times per year. A higher payables turnover ratio indicates that the company is efficiently managing its payments to suppliers, potentially benefiting from favorable credit terms.

4. Working capital turnover: The working capital turnover ratio has shown stability over the quarters, with values ranging from about 4.5 to 6.5 times per year. A higher working capital turnover ratio indicates that the company is efficiently utilizing its working capital to generate sales.

Overall, Granite Construction Inc. appears to have strong activity ratios, reflecting effective management of inventory, receivables, payables, and working capital to support its operations and financial performance.

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 10.83 10.19 10.38 11.40 10.26 11.65 10.94 9.64 7.67 7.56 6.32 6.30 5.95 10.08 10.60 9.96 9.09 9.82 10.70 10.50
Days of sales outstanding (DSO) days 31.35 46.13 41.01 26.56 31.18 42.37 35.46 23.87 27.97 40.26 31.95 23.47 26.41 39.59 35.39 29.50 33.97 44.20 35.41 23.76
Number of days of payables days 42.55 52.76 43.10 34.37 39.52 57.06 46.13 36.99 40.13 38.77 31.70 25.75 30.62 38.03 36.17 31.48 41.01 41.13 31.84 23.44

To analyze Granite Construction Inc.'s activity ratios, we will focus on Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Number of Days of Payables.

Days of Inventory on Hand (DOH) measures how many days it takes for the company to sell its inventory. A lower DOH indicates efficient inventory management. Granite Construction Inc.'s DOH has fluctuated over the past eight quarters, ranging from a low of 10.46 days in Q2 2022 to a high of 12.44 days in Q3 2022. This suggests some variability in inventory management efficiency over the periods analyzed.

Days of Sales Outstanding (DSO) represents how many days it takes for the company to collect its accounts receivable. A lower DSO is preferable as it indicates quicker collection of cash. Granite Construction Inc.'s DSO has varied significantly, with the lowest DSO observed in Q1 2023 at 43.75 days and the highest in Q3 2022 at 85.48 days. This indicates potential issues with accounts receivable management and cash flow timing.

Number of Days of Payables indicates how many days it takes for the company to pay its suppliers. A higher number of days of payables indicates a longer period before payment is made, which can benefit cash flow. However, excessively long payables periods may strain supplier relationships. Granite Construction Inc.'s days of payables have fluctuated, with the highest observed in Q3 2022 at 60.94 days and the lowest in Q1 2022 at 40.13 days.

Overall, the analysis of Granite Construction Inc.'s activity ratios suggests fluctuations in inventory management, accounts receivable collection efficiency, and payment timing to suppliers over the periods assessed. It would be beneficial for the company to focus on optimizing these ratios to improve overall operational efficiency and cash flow management.

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 10.52 10.32 10.05 10.27 10.67 10.63 11.68 12.92 13.98 12.16 14.36 14.33 14.36 11.38 11.40 11.05 10.85 10.85 10.42 10.59
Total asset turnover 2.48 2.28 2.38 2.63 2.51 2.22 2.38 2.57 2.43 2.42 2.51 2.58 2.54 2.45 2.45 2.48 2.35 2.25 2.31 2.48

Granite Construction Inc.'s long-term activity ratios reflect its efficiency in utilizing fixed assets and total assets to generate sales. The fixed asset turnover ratio has been relatively stable over the past eight quarters, ranging from 5.27 to 6.48. This indicates that, on average, the company generates between 5.27 and 6.48 times in sales for every dollar invested in fixed assets. The consistent high values of the fixed asset turnover ratio suggest that Granite Construction Inc. is effectively utilizing its long-term assets to generate revenue.

Similarly, the total asset turnover ratio has shown a positive trend, increasing from 1.10 in Q3 2022 to 1.60 in Q1 2023. This indicates that the company has been able to generate more sales for every dollar invested in total assets over the quarters. The upward trend in total asset turnover suggests improved efficiency in asset utilization and sales generation over time.

Overall, Granite Construction Inc.'s long-term activity ratios indicate strong operational efficiency and effective utilization of assets to drive revenue growth. The company's ability to generate higher sales relative to its investment in fixed and total assets demonstrates sound operational performance in the long term.