Jabil Circuit Inc (JBL)

Short-term

Turnover ratios

The inventory turnover ratio for Jabil Circuit Inc has been relatively stable over the past five years, ranging from 5.24 to 8.53 times. This indicates that the company efficiently manages its inventory levels, with goods being sold and replaced multiple times within a year.

The receivables turnover ratio shows how quickly the company collects outstanding payments from its customers. While data is not available for two years, it can be observed that in the years provided, the turnover has been consistently high, indicating effective credit and collection policies.

The payables turnover ratio measures how quickly the company pays its suppliers. Jabil Circuit Inc's payables turnover has fluctuated over the years, showing a decreasing trend. This implies that the company is taking longer to pay its suppliers, which may be beneficial for cash flow management but could also signal potential strain in supplier relationships.

The working capital turnover ratio reflects how efficiently the company generates revenue relative to its working capital. Jabil Circuit Inc's working capital turnover has varied significantly, with a notable decline in the most recent years. A high turnover ratio signifies efficient use of working capital to generate sales, while a lower ratio may indicate possible inefficiencies in managing working capital.

Overall, Jabil Circuit Inc has shown a mix of stable and fluctuating activity ratios, suggesting varying levels of efficiency in managing its operations and resources over the past five years.

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Average number of days

Analyzing the activity ratios of Jabil Circuit Inc over the past five years reveals key insights into its operational efficiency.

1. Days of Inventory on Hand (DOH):
- The DOH has fluctuated over the years, ranging from 42.77 days in 2020 to 69.63 days in 2022, with a recent value of 56.24 days in 2024.
- A lower DOH, as observed in 2020, indicates a quicker turnover of inventory, potentially signaling effective inventory management.
- The increasing trend from 2020 to 2022 suggests a buildup of inventory levels, which could pose risks related to obsolescence and storage costs.
- The decrease in 2024 compared to 2022 is a positive sign, showing potential efforts to optimize inventory levels and enhance liquidity.

2. Days of Sales Outstanding (DSO):
- Data for 2020 and 2023 are missing, limiting a comprehensive trend analysis for this ratio.
- However, in the available years, DSO ranges from 39.34 days in 2021 to 43.76 days in 2022, with a recent missing value in 2024.
- A lower DSO indicates a faster collection of receivables, improving cash flow and liquidity for the company.
- Continuous monitoring of DSO can help assess the effectiveness of credit policies and customer payment practices.

3. Number of Days of Payables:
- The number of days of payables for Jabil Circuit Inc has shown variability over the years, with values ranging from 62.40 days in 2023 to 90.97 days in 2022.
- An increase in the number of days of payables, as seen in 2022, may signify the company's ability to delay payments to suppliers, providing a source of short-term financing.
- Conversely, a decrease in payables days, as observed in 2023, could indicate a potential strain on liquidity or changes in vendor terms.
- Keeping payables days in check is crucial to managing working capital effectively and balancing trade credit with supplier relationships.

In conclusion, analyzing Jabil Circuit Inc's activity ratios highlights the company's inventory management, accounts receivable collection efficiency, and payment practices. Continuous monitoring and adjustment of these ratios can help improve operational performance and financial health in the long run.

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Long-term

The fixed asset turnover ratio for Jabil Circuit Inc has fluctuated over the past five years, ranging from a low of 3.32 in 2021 to a high of 7.38 in 2020. This ratio measures how efficiently the company generates sales revenue from its fixed assets. A higher ratio indicates that the company is utilizing its fixed assets more effectively to generate sales.

On the other hand, the total asset turnover ratio has also shown variability over the same period, with values ranging from 1.69 to 1.88. This ratio reflects the company's ability to generate sales from all its assets, including both fixed and current assets. A higher total asset turnover ratio suggests that the company is efficiently utilizing all its assets to generate revenue.

Overall, while the fixed asset turnover ratio demonstrates the efficiency of utilizing fixed assets, the total asset turnover ratio provides a broader perspective on the company's ability to generate sales from all its assets. A comparison of these ratios over time can help assess the company's operational efficiency and asset utilization strategies.