Humana Inc (HUM)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | — | — | — | — | — |
| Receivables turnover | 52.27 | 55.48 | 45.79 | 67.80 | 61.45 |
| Payables turnover | — | — | — | — | — |
| Working capital turnover | 9.57 | 10.31 | 8.69 | 7.53 | 7.24 |
The activity ratios of Humana Inc. provide insights into the efficiency of the company's operations and management of its assets.
1. Receivables Turnover:
- The receivables turnover ratio measures how many times a company collects its accounts receivable during a specific period.
- Humana's receivables turnover has shown a fluctuating trend over the past five years, with values ranging from 45.79 to 67.80.
- A higher receivables turnover ratio indicates that the company is efficient in collecting payments from customers.
2. Working Capital Turnover:
- The working capital turnover ratio evaluates how efficiently a company is utilizing its working capital to generate sales.
- Humana's working capital turnover has increased steadily over the past five years, from 7.24 to 9.57.
- A higher working capital turnover ratio suggests that the company is effectively using its working capital to drive revenue generation.
3. Inventory Turnover and Payables Turnover:
- Unfortunately, there is no data provided for inventory turnover and payables turnover, limiting a comprehensive analysis of these ratios for Humana Inc.
- Both inventory turnover and payables turnover ratios are crucial in assessing how efficiently a company manages its inventory and pays its suppliers.
Overall, based on the available data for receivables turnover and working capital turnover, Humana Inc. has demonstrated improvements in managing its receivables and utilizing its working capital efficiently to generate sales over the past five years.
Average number of days
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | 6.98 | 6.58 | 7.97 | 5.38 | 5.94 |
| Number of days of payables | days | — | — | — | — | — |
Days of inventory on hand (DOH) is not provided in the data, which could indicate that Humana Inc. may not hold significant levels of inventory as part of its operations.
Days of sales outstanding (DSO) shows a slight increase from 6.58 days in 2022 to 6.98 days in 2023. This suggests that, on average, it takes Humana Inc. slightly longer to collect payments from customers in 2023 compared to 2022. However, the DSO levels remain relatively low, indicating efficient management of accounts receivable.
The number of days of payables is not provided in the data, but typically longer payables period would imply that Humana Inc. is taking more time to pay its trade payables.
Overall, the activity ratios suggest that Humana Inc. is effectively managing its accounts receivable, and limited inventory levels in the operations based on the provided data. Further analysis of payables turnover could provide a more complete picture of the company's working capital management.
See also:
Humana Inc Short-term (Operating) Activity Ratios
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 35.11 | 28.83 | 27.03 | 32.54 | 33.19 |
| Total asset turnover | 2.26 | 2.16 | 1.87 | 2.21 | 2.23 |
The long-term activity ratios of Humana Inc. reflect the company's efficiency in utilizing its assets to generate revenue over the years. The fixed asset turnover ratio has shown an increasing trend from 2019 to 2023, indicating that the company is generating more revenue per dollar invested in fixed assets. This suggests that Humana has been able to efficiently use its long-term assets to drive sales.
The total asset turnover ratio, on the other hand, has fluctuated over the years, but generally remains at a moderate level. This ratio measures how effectively the company is utilizing all its assets to generate sales. While there has been some variation, the ratio has remained above 2 in recent years, implying that Humana is efficiently generating revenue relative to its total asset base.
Overall, the improving trend in the fixed asset turnover ratio coupled with the relatively stable total asset turnover ratio suggests that Humana Inc. has been successful in efficiently managing its long-term assets to drive sales and generate revenue. This indicates a sound operational efficiency in utilizing assets for revenue generation purposes.