Ingersoll Rand Inc (IR)
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 | 3.99 | 3.62 | 3.51 | 3.34 | 3.50 | 3.49 | 3.36 | 3.45 | 3.70 | 3.49 | 3.62 | 3.40 | 3.68 | 1.95 | 1.61 | 1.23 | 2.47 | 2.97 | 2.97 | 3.03 |
| Receivables turnover | 5.57 | 5.49 | 5.29 | 4.99 | 5.27 | 5.53 | 5.42 | 5.29 | 5.43 | 5.34 | 5.06 | 4.59 | 4.20 | 3.22 | 2.71 | 2.04 | 4.39 | 5.58 | 5.32 | 5.28 |
| Payables turnover | 4.98 | 5.92 | 5.77 | 5.12 | 4.61 | 5.05 | 4.85 | 4.70 | 4.72 | 4.76 | 4.36 | 4.20 | 4.92 | 3.14 | 2.42 | 1.75 | 3.84 | 4.76 | 4.99 | 4.90 |
| Working capital turnover | 3.09 | 3.21 | 3.07 | 3.15 | 2.58 | 2.57 | 2.64 | 1.96 | 1.95 | 2.06 | 1.22 | 1.71 | 1.72 | 1.48 | 1.35 | 1.36 | 2.08 | 2.85 | 3.04 | 3.44 |
Inventory turnover measures how many times a company's inventory is sold and replaced during a period. Ingersoll-Rand Inc's inventory turnover has been relatively stable, ranging from 3.18 to 3.99 over the past eight quarters. This indicates that the company is efficiently managing its inventory levels.
Receivables turnover reflects how quickly a company collects its outstanding receivables. Ingersoll-Rand Inc's receivables turnover has shown consistency, hovering between 5.05 and 5.57 during the same period. This suggests the company has an effective credit and collection policy in place.
Payables turnover measures how quickly a company pays its suppliers. Ingersoll-Rand Inc's payables turnover has fluctuated, ranging from 4.45 to 5.92 over the past eight quarters. A higher turnover ratio signifies that the company is paying its suppliers more quickly.
Working capital turnover indicates how efficiently a company is using its working capital to generate sales revenue. Ingersoll-Rand Inc's working capital turnover has shown improvement, increasing from 1.87 to 3.21 over the past two years. This suggests that the company is using its working capital more effectively to support its operations and generate sales.
Overall, based on the activity ratios analyzed, Ingersoll-Rand Inc appears to have a good level of efficiency in managing its inventory, receivables, payables, and working capital to support its operations and generate sales revenue. However, the company should continue monitoring and optimizing these ratios to ensure continued operational efficiency.
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 | 91.49 | 100.75 | 104.04 | 109.42 | 104.23 | 104.67 | 108.77 | 105.70 | 98.54 | 104.72 | 100.92 | 107.29 | 99.07 | 187.16 | 226.05 | 297.45 | 148.01 | 122.77 | 122.97 | 120.65 |
| Days of sales outstanding (DSO) | days | 65.51 | 66.46 | 68.97 | 73.11 | 69.22 | 65.97 | 67.34 | 69.04 | 67.20 | 68.33 | 72.07 | 79.58 | 86.90 | 113.23 | 134.80 | 178.53 | 83.06 | 65.39 | 68.64 | 69.17 |
| Number of days of payables | days | 73.22 | 61.70 | 63.22 | 71.24 | 79.16 | 72.25 | 75.22 | 77.64 | 77.35 | 76.75 | 83.69 | 86.89 | 74.14 | 116.06 | 150.53 | 209.02 | 95.11 | 76.62 | 73.17 | 74.42 |
Days of inventory on hand (DOH) measures how efficiently a company manages its inventory. Ingersoll-Rand Inc's DOH has shown a slight improvement from Q1 2023 to Q4 2023, indicating that the company is now holding inventory for a shorter period before selling it. However, the current DOH of 91.49 days is still relatively high compared to historical levels.
Days of sales outstanding (DSO) represents the average number of days it takes for a company to collect its accounts receivable. Ingersoll-Rand Inc's DSO has fluctuated over the past four quarters, with a peak in Q1 2023 at 73.11 days. The DSO has decreased in Q4 2023 to 65.51 days, which suggests an improvement in the company's collection efficiency.
Number of days of payables calculates how long a company takes to pay its suppliers. Ingersoll-Rand Inc's number of days of payables has been volatile, with Q4 2022 showing the highest number of days at 79.16. The company has since reduced its payables period, with Q3 2023 showing the lowest number of days at 61.70. In Q4 2023, the number of days of payables increased to 73.22 days, indicating that the company is taking slightly longer to pay its suppliers.
Overall, Ingersoll-Rand Inc has shown mixed performance in its activity ratios over the past few quarters. The company has made some improvements in managing its inventory and collecting receivables more efficiently. However, there is room for further optimization in reducing the number of days of payables to enhance its working capital 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 | 9.67 | 9.74 | 10.00 | 9.57 | 9.48 | 9.72 | 9.08 | 8.44 | 7.94 | 8.00 | 7.81 | 6.29 | 6.67 | 3.73 | 3.00 | 2.53 | 6.18 | 7.66 | 7.68 | 7.70 |
| Total asset turnover | 0.44 | 0.44 | 0.43 | 0.41 | 0.40 | 0.40 | 0.39 | 0.35 | 0.34 | 0.33 | 0.29 | 0.28 | 0.25 | 0.19 | 0.16 | 0.14 | 0.44 | 0.56 | 0.58 | 0.59 |
Long-term activity ratios provide insights into how well a company utilizes its assets to generate sales. In the case of Ingersoll-Rand Inc, we analyze the fixed asset turnover and total asset turnover ratios over the past eight quarters.
1. Fixed Asset Turnover:
- The fixed asset turnover ratio measures how efficiently a company generates revenue from its fixed assets.
- Ingersoll-Rand Inc's fixed asset turnover ratio has been relatively stable over the quarters, ranging from 8.06 to 10.00.
- A higher ratio indicates that the company is effectively utilizing its fixed assets to generate sales.
- The trend suggests that Ingersoll-Rand Inc has been consistently efficient in utilizing its fixed assets to generate revenue.
2. Total Asset Turnover:
- The total asset turnover ratio indicates the efficiency of a company in generating sales from all its assets.
- Ingersoll-Rand Inc's total asset turnover ratio has been increasing steadily over the quarters, indicating improved efficiency in asset utilization.
- The ratio has increased from 0.34 in Q1 2022 to 0.44 in Q4 2023, showcasing a positive trend in asset efficiency.
- A higher ratio implies that the company is generating more sales for each dollar invested in assets.
Overall, based on the long-term activity ratios analysis, Ingersoll-Rand Inc has demonstrated efficiency in utilizing both fixed assets and total assets to generate revenue. The company's stability in fixed asset turnover and consistent improvement in total asset turnover reflect a positive trend in asset utilization efficiency, which is a favorable indicator for investors and stakeholders.