Ligand Pharmaceuticals Incorporated (LGND)

Short-term

Turnover ratios

Inventory Turnover Ratio:

Ligand Pharmaceuticals' inventory turnover ratio has shown fluctuations over the years. Initially, the ratio was low, indicating slower inventory turnover. However, there was a significant increase in the ratio in the later years, peaking at an incredibly high value in the third quarter of 2022 before gradually decreasing. This suggests that the company was able to sell its inventory at a faster pace during those periods.

Receivables Turnover Ratio:

The data does not provide any information on Ligand Pharmaceuticals' receivables turnover ratio. This may indicate that the company does not disclose this metric or that there were no accounts receivable turnovers during the mentioned periods.

Payables Turnover Ratio:

Similar to receivables turnover, the payables turnover ratio is not available in the data provided for Ligand Pharmaceuticals. This may suggest that the company does not disclose this metric or that there were no significant payables turnover during the specified periods.

Working Capital Turnover Ratio:

Ligand Pharmaceuticals' working capital turnover ratio has been fluctuating over the years. The ratio started at relatively low levels and experienced a sharp increase in the second quarter of 2022, reaching an unusually high value. This surge was followed by a decline in the ratio. Overall, the ratios suggest variability in the efficiency of utilizing working capital in generating sales during the specified periods.

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Average number of days

Based on the provided data, let's analyze the activity ratios for Ligand Pharmaceuticals Incorporated:

1. Days of Inventory on Hand (DOH):
- Ligand Pharmaceuticals' DOH has fluctuated significantly over the reporting periods, ranging from as low as 0.19 days to as high as 830.44 days.
- A lower DOH indicates efficient management of inventory, while a higher DOH suggests potential issues with inventory management, such as overstocking or slow-moving inventory.
- Ligand experienced a notable improvement in inventory management between December 31, 2023, and March 31, 2024, with the DOH decreasing from 830.44 days to 435.42 days.

2. Days of Sales Outstanding (DSO):
- The DSO data was not provided, indicating that the company may not have significant accounts receivable balances or operates on a cash basis.
- Without DSO information, it is challenging to assess the efficiency of Ligand's accounts receivable collection process.

3. Number of Days of Payables:
- Similarly, data on the number of days of payables was not available, suggesting that information on the company's payment terms with suppliers is not provided.
- The management of payables is crucial for maintaining positive relationships with suppliers and optimizing cash flow through potential extended payment terms.

In conclusion, while the information on Ligand Pharmaceuticals' inventory management was detailed, the lack of data on accounts receivable and payables hinders a comprehensive analysis of the company's overall working capital efficiency and cash conversion cycle.

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Long-term

Based on the provided data on Ligand Pharmaceuticals Incorporated's long-term activity ratios:

1. Fixed Asset Turnover:
- The Fixed Asset Turnover ratio measures how efficiently the company is utilizing its fixed assets to generate sales.
- In March 2020, Ligand Pharmaceuticals had a high Fixed Asset Turnover ratio of 16.44, indicating that the company generated significant sales relative to its investment in fixed assets.
- The ratio remained relatively high through September 2021 but started to decline significantly thereafter, reaching a low of 7.23 in September 2022.
- Despite some fluctuations, the Fixed Asset Turnover ratio rebounded strongly in March 2023 to 18.55, showing improved efficiency in utilizing fixed assets.
- The ratio was not provided for the latter half of 2023 and all of 2024, which could indicate missing or incomplete data for analysis.

2. Total Asset Turnover:
- The Total Asset Turnover ratio assesses how well the company is utilizing all its assets to generate revenue.
- Ligand Pharmaceuticals saw a gradual increase in Total Asset Turnover from March 2020 to December 2021, indicating improved efficiency in generating sales using its total assets.
- There was a notable spike in the ratio in September 2022, reaching a very high value of 229.95, which seems like an anomaly or data error compared to the historical trend.
- The ratio then normalized in the following periods, showing a more reasonable range of values.
- The declining trend in Total Asset Turnover from March 2023 to June 2024 suggests a decrease in the company's efficiency in generating revenue relative to its total assets.

In conclusion, Ligand Pharmaceuticals Incorporated experienced fluctuations in both Fixed Asset Turnover and Total Asset Turnover ratios over the reported periods. The company displayed periods of high efficiency in asset utilization, as well as declines and anomalies that may warrant further investigation to understand the underlying operational dynamics impacting these ratios.