Hilton Grand Vacations Inc (HGV)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 0.46 | 0.38 | 0.36 | — | — |
| Receivables turnover | 15.81 | 7.85 | 7.50 | 7.73 | 7.51 |
| Payables turnover | — | — | — | — | — |
| Working capital turnover | 1.38 | 1.65 | — | 3.75 | 1.68 |
Hilton Grand Vacations Inc's activity ratios provide insights into how efficiently the company manages its resources.
1. Inventory Turnover: The inventory turnover ratio measures how many times a company sells and replaces its inventory during a certain period. Hilton Grand Vacations Inc's inventory turnover has been relatively low, improving from 0.36 in 2022 to 0.46 in 2024. This suggests that the company is selling its inventory at a slower pace compared to previous years.
2. Receivables Turnover: The receivables turnover ratio indicates how efficiently a company collects cash from its customers. Hilton Grand Vacations Inc's receivables turnover has been consistently strong, increasing from 7.51 in 2020 to a significant 15.81 in 2024. This improvement demonstrates that the company is collecting cash from its customers more quickly over the years.
3. Payables Turnover: The payables turnover ratio measures how efficiently a company pays its suppliers. In this case, Hilton Grand Vacations Inc's payables turnover data is not provided, suggesting that information on supplier payment efficiency is not available.
4. Working Capital Turnover: The working capital turnover ratio shows how effectively a company utilizes its working capital to generate sales. Hilton Grand Vacations Inc's working capital turnover has fluctuated, with a notable increase from 1.68 in 2020 to 3.75 in 2021, before dropping to 1.38 in 2024. This implies that the company's ability to generate sales using its working capital has varied over the years.
In conclusion, Hilton Grand Vacations Inc's activity ratios paint a mixed picture of its operational efficiency. While the company has shown improvements in receivables turnover, there are areas, such as inventory turnover and working capital turnover, that may require further attention to optimize resources and enhance profitability.
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 | 794.43 | 962.34 | 1,004.83 | — | — |
| Days of sales outstanding (DSO) | days | 23.08 | 46.52 | 48.63 | 47.21 | 48.59 |
| Number of days of payables | days | — | — | — | — | — |
Hilton Grand Vacations Inc's activity ratios indicate how efficiently the company manages its working capital and inventory turnover.
1. Days of Inventory on Hand (DOH):
- In 2020 and 2021, the data is not available.
- In 2022, the company had 1,004.83 days of inventory on hand, which decreased to 962.34 days by the end of 2023 and further decreased to 794.43 days by the end of 2024.
- A decrease in the number of days of inventory on hand over time suggests that the company is managing its inventory levels more effectively and possibly selling inventory at a faster rate.
2. Days of Sales Outstanding (DSO):
- In 2021, the company took an average of 48.59 days to collect payment from its customers, which decreased to 47.21 days in 2021. The trend continued to improve with DSO decreasing to 46.52 days by the end of 2023 and significantly dropping to 23.08 days by the end of 2024.
- A decreasing trend in DSO indicates that Hilton Grand Vacations is collecting payments from customers more quickly, which reflects effective credit management and efficient accounts receivable turnover.
3. Number of Days of Payables:
- There is no data available for days of payables for the years provided (2020-2024).
- Without this information, it is challenging to assess how efficiently the company manages its trade payables in relation to its sales and purchases.
In conclusion, Hilton Grand Vacations Inc has shown improvements in managing its inventory turnover and accounts receivable collection efficiency over the years, which is indicative of effective working capital management and operational performance. However, the analysis would be more comprehensive with data on the company's payables turnover to assess its complete working capital cycle.
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 6.29 | 5.25 | 4.81 | 3.09 | 1.78 |
| Total asset turnover | 0.44 | 0.46 | 0.48 | 0.29 | 0.29 |
The fixed asset turnover ratio for Hilton Grand Vacations Inc has shown a significant improvement over the years, increasing from 1.78 in 2020 to 6.29 in 2024. This indicates that the company is generating more revenue relative to its investment in fixed assets, reflecting an efficient utilization of its property, plant, and equipment.
On the other hand, the total asset turnover ratio has been relatively stable, hovering around 0.29 in 2020 and 2021, then increasing to 0.48 in 2022, before declining slightly to 0.44 in 2024. This suggests that the company has been effective in utilizing its total assets to generate sales, but there has been a slight dip in efficiency in recent years.
Overall, the trend in both fixed asset turnover and total asset turnover ratios indicates that Hilton Grand Vacations Inc has been successfully managing its assets to drive sales growth and improve operational efficiency over the past five years.