Helmerich and Payne Inc (HP)

Short-term

Turnover ratios

Based on the provided activity ratios for Helmerich & Payne, Inc., the inventory turnover for the last five years appears to be consistently 0.00, indicating that the company is not effectively utilizing its inventory to generate sales during these periods. This could potentially suggest issues with inventory management or slow-moving inventory.

In contrast, the receivables turnover shows a varying trend, with a noticeable increase from 2020 to 2021, albeit a slight decrease in 2022, and a subsequent increase in 2023. This indicates that the company has been collecting its accounts receivable at a faster rate, which can be a positive indication of efficient credit and collection policies.

The payables turnover ratio of 0.00 for the last five years suggests that the company may not be effectively managing its accounts payable, and this may warrant further investigation into payment policies and supplier relationships.

Furthermore, the working capital turnover shows an increasing trend from 2019 to 2023, indicating that the company has been able to generate higher sales revenue relative to its working capital over these years, which can be a positive sign of operational efficiency and effective utilization of capital.

Overall, while the company appears to have issues with inventory turnover and payables turnover, the increasing trend in receivables turnover and working capital turnover suggests improvements in the management of receivables and working capital efficiency over the years.

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Average number of days

Days of Sales Outstanding (DSO) measures the average number of days it takes for a company to collect payment after making a sale. A lower DSO is generally favorable as it indicates quicker cash collection. Helmerich & Payne, Inc. saw a significant improvement in DSO from 81.32 days in 2022 to 51.36 days in 2023, showcasing more efficient receivables management. This could indicate improved credit and collection policies or better customer payment behavior.

Days of Inventory on Hand (DOH) represents the average number of days it takes for a company to sell its entire inventory. Unfortunately, the data provided does not include DOH figures for analysis.

Number of Days of Payables measures the average number of days a company takes to pay its suppliers. The absence of this data for Helmerich & Payne, Inc. precludes an analysis of the trend in this respect.

In summary, the improvement in DSO for Helmerich & Payne, Inc. suggests enhanced cash flow and potentially better working capital management. However, a complete evaluation of the company's efficiency in managing its inventory and payables requires additional data.

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Long-term

The fixed asset turnover ratio for Helmerich & Payne, Inc. has shown a fluctuating trend over the past five years. It increased from 0.39 in 2021 to 0.98 in 2023, indicating a substantial improvement in the company's ability to generate revenue from its fixed assets. This may be attributed to increased operational efficiency and effective utilization of fixed assets in revenue-generating activities.

On the other hand, the total asset turnover ratio also displayed a volatile pattern. It rose from 0.24 in 2021 to 0.66 in 2023, suggesting a significant enhancement in the company's overall efficiency in utilizing its total assets to generate sales. This improvement may be indicative of the company's better management of its total assets and a more effective allocation of resources to revenue-generating activities.

Overall, the upward trends in both the fixed asset turnover and total asset turnover ratios signify an improvement in Helmerich & Payne, Inc.'s long-term activity efficiency and the effectiveness of its asset utilization strategies over the years.