HealthStream Inc (HSTM)

Fixed asset turnover

		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
Revenue (ttm)	US$ in thousands	279,064	277,019	273,965	270,405	266,826	262,607	259,413	258,591	256,692	254,193	250,985	246,722	244,826	245,703	247,270	250,498	254,113	251,243	248,718	241,945
Property, plant and equipment	US$ in thousands	13,005	13,536	14,461	14,689	15,483	15,658	16,477	17,070	17,950	18,333	19,516	20,653	22,218	21,793	22,936	24,425	26,065	26,931	28,544	23,708
Fixed asset turnover		21.46	20.47	18.95	18.41	17.23	16.77	15.74	15.15	14.30	13.87	12.86	11.95	11.02	11.27	10.78	10.26	9.75	9.33	8.71	10.21

December 31, 2023 calculation

Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $279,064K ÷ $13,005K
= 21.46

Healthstream Inc's fixed asset turnover has shown a consistent increasing trend over the past eight quarters, reflecting the company's ability to generate sales revenue relative to its investment in fixed assets. The ratio has increased from 15.15 in Q1 2022 to 21.46 in Q4 2023, indicating that the company is becoming more efficient in utilizing its fixed assets to generate sales.

A higher fixed asset turnover ratio indicates that the company is generating more sales revenue for each dollar invested in fixed assets. This implies efficient utilization of fixed assets, potentially resulting in higher profitability and return on investment. Healthstream Inc's trend of increasing fixed asset turnover suggests improved operational efficiency and better asset management.

It is important to note that a high fixed asset turnover ratio may also signify aggressive sales strategies or underutilization of fixed assets, which could lead to operational risks. Therefore, it is crucial to monitor other financial metrics and performance indicators in conjunction with the fixed asset turnover ratio to gain a comprehensive understanding of Healthstream Inc's operational efficiency and financial stability.