LeMaitre Vascular Inc (LMAT)

Short-term

Turnover ratios

The activity ratios of Lemaitre Vascular Inc provide insight into the efficiency of the company's operations in managing its inventory, receivables, payables, and working capital.

1. Inventory turnover:
The inventory turnover ratio measures how well Lemaitre Vascular Inc manages its inventory levels by showing how many times it sells and replaces its inventory during a specific period. The trend indicates a slight decrease in recent years, from 1.30 in 2021 to 1.14 in 2023. This may suggest that the company is taking longer to sell its inventory, which could tie up capital and impact profitability.

2. Receivables turnover:
The receivables turnover ratio reflects the efficiency of Lemaitre Vascular Inc in collecting payment from customers for credit sales. A higher ratio is generally preferred, indicating the company is converting receivables into cash quickly. The trend shows fluctuations, but overall, the ratio has improved from 6.62 in 2020 to 7.72 in 2023, suggesting better collection practices.

3. Payables turnover:
The payables turnover ratio reveals how quickly Lemaitre Vascular Inc pays its suppliers for credit purchases. A higher ratio can indicate better liquidity management. The trend has varied, with a notable increase in 2021 before a decrease in 2023. This fluctuation could be due to changes in payment terms with suppliers or variations in purchasing patterns.

4. Working capital turnover:
The working capital turnover ratio assesses how effectively Lemaitre Vascular Inc utilizes its working capital to generate sales revenue. A higher ratio signifies efficient utilization of resources. The trend reflects fluctuations, with a notable decrease in 2023 compared to 2021. This could indicate a decrease in sales relative to working capital, potentially signaling a need for improved operational efficiency or capital management.

In conclusion, Lemaitre Vascular Inc's activity ratios provide valuable insights into its operational efficiency and working capital management. Monitoring these ratios over time can help identify areas for improvement and guide strategic decision-making to enhance overall performance.

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Average number of days

Analyzing Lemaitre Vascular Inc's activity ratios, we can observe fluctuations in the efficiency of its inventory management, accounts receivable collection, and accounts payable payment over the past five years.

- Days of Inventory on Hand (DOH): Lemaitre Vascular Inc's average days of inventory on hand have shown inconsistency, ranging from a high of 338.15 days in 2019 to a low of 279.71 days in 2021. A lower DOH indicates faster inventory turnover and more efficient management of inventory levels. While the company improved its inventory management in 2021 compared to 2019, it regressed in 2023 with a higher DOH of 319.10 days.

- Days of Sales Outstanding (DSO): Lemaitre Vascular Inc's days of sales outstanding have varied slightly over the years, with a range between 46.40 days in 2021 and 55.17 days in 2020. A lower DSO signifies a quicker collection of accounts receivable, indicating effective credit management and sales practices. The company saw an improvement in collections in 2021 compared to 2020, but the DSO increased slightly in 2023 to 47.28 days.

- Number of Days of Payables: Lemaitre Vascular Inc's days of payables have fluctuated, with the number of days ranging from 16.10 days in 2021 to 25.43 days in 2019. A lower number of days of payables suggests more efficient management of trade credit terms and working capital. The company improved its payables efficiency in 2021 compared to 2019, but experienced a slight increase in 2023 with 20.51 days.

In summary, while Lemaitre Vascular Inc has shown variability in its activity ratios over the years, there are opportunities for the company to further optimize its inventory management, accounts receivable collection, and accounts payable payment to enhance its operational efficiency and working capital management.

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Long-term

The fixed asset turnover ratio for Lemaitre Vascular Inc has shown consistent improvement over the years, indicating that the company is generating more revenue per dollar of fixed assets invested. This suggests that the company is utilizing its fixed assets more efficiently to generate sales. The increase in the ratio from 7.89 in 2019 to 8.89 in 2023 shows a positive trend in the company's ability to generate sales from its fixed assets.

On the other hand, the total asset turnover ratio has fluctuated over the years, with a slight increase from 2019 to 2021, followed by a decrease in 2022 and 2023. A total asset turnover ratio of less than 1 indicates that Lemaitre Vascular Inc is not generating as much revenue relative to its total assets. This could imply that the company may have excessive assets compared to its sales levels.

Overall, while the fixed asset turnover ratio reflects improved efficiency in utilizing fixed assets to generate revenue, the total asset turnover ratio suggests that there may be room for Lemaitre Vascular Inc to enhance its overall asset utilization efficiency to boost sales relative to its total asset base.