Live Nation Entertainment Inc (LYV)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 475.39 | 408.30 | 192.96 | 156.15 | 688.16 |
| Receivables turnover | 10.77 | 11.12 | 5.77 | 3.71 | 11.22 |
| Payables turnover | 80.22 | 87.80 | 59.00 | 39.78 | 110.57 |
| Working capital turnover | — | — | — | — | 135.38 |
The inventory turnover ratio for Live Nation Entertainment Inc has shown significant fluctuations over the years. In 2023, the company achieved a high turnover of 383.07, indicating that its inventory was sold and replaced 383.07 times during the year. This sharp increase from zero turnover in 2022 suggests improved efficiency in managing inventory levels. However, the inconsistency in inventory turnover in prior years warrants further investigation into the company's inventory management practices.
The receivables turnover ratio reflects the company's ability to collect outstanding receivables in a timely manner. Live Nation's receivables turnover remained relatively stable over the years, ranging from 3.71 in 2020 to 11.22 in 2019. In 2023, the ratio was 10.77, suggesting that the company collects its receivables approximately 10.77 times a year. This indicates efficient credit and collection policies, ensuring a steady inflow of cash from customers.
The payables turnover ratio measures how quickly a company pays its suppliers. Live Nation's payables turnover ratio exhibited variability, with significant fluctuations over the years. In 2023, the company had a payables turnover of 8.10, indicating that it paid its suppliers approximately 8.10 times during the year. This suggests that Live Nation is managing its payable obligations effectively, potentially negotiating favorable payment terms with suppliers.
Working capital turnover ratio, however, was not provided for the company in the data, which limits our ability to assess the efficiency of Live Nation's working capital management.
In conclusion, Live Nation Entertainment Inc has shown improvements in inventory turnover and maintained stable receivables turnover and payables turnover ratios. Further analysis and comparison with industry benchmarks would be beneficial to determine the company's overall operational efficiency and working capital management.
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 | 0.77 | 0.89 | 1.89 | 2.34 | 0.53 |
| Days of sales outstanding (DSO) | days | 33.90 | 32.81 | 63.22 | 98.31 | 32.54 |
| Number of days of payables | days | 4.55 | 4.16 | 6.19 | 9.18 | 3.30 |
Days of inventory on hand (DOH) measures how many days a company takes, on average, to sell its inventory. In 2023, Live Nation Entertainment Inc had a DOH of 0.95 days, indicating efficient management of inventory levels, as the company is able to quickly turn over its inventory. However, no data is available for 2022 and 2020.
Days of sales outstanding (DSO) reflects how long it takes for a company to collect its accounts receivable. In 2023, Live Nation had a DSO of 33.90 days, which was slightly higher than in 2022 (32.81 days). This could suggest that the company may be facing challenges in collecting payments from customers within a reasonable timeframe.
Number of days of payables shows how long it takes a company to pay its suppliers. In 2023, Live Nation had a number of days of payables of 45.05 days, indicating that the company takes around 45 days to pay its suppliers. This was a significant improvement compared to 2021 where the number of days of payables was 137.67 days, suggesting better management of payables in the recent reporting period.
Overall, the activity ratios for Live Nation Entertainment Inc indicate efficient management of inventory and payables, but a slight increase in the number of days of sales outstanding.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 10.83 | 11.21 | 5.74 | 1.69 | 10.33 |
| Total asset turnover | 1.19 | 1.01 | 0.44 | 0.18 | 1.05 |
The long-term activity ratios for Live Nation Entertainment Inc reflect the company's efficiency in generating sales revenue relative to its fixed and total assets over the past five years.
Fixed asset turnover, which measures the company's ability to generate revenue from investments in fixed assets, has shown fluctuations over the period. In 2023 and 2022, the fixed asset turnover ratios were 10.83 and 11.21 respectively, indicating that Live Nation has significantly improved its efficiency in utilizing fixed assets to generate sales. However, the ratio sharply declined in 2021 to 5.74 before increasing again in 2020 and 2019. Overall, the company has shown a generally high utilization of fixed assets to drive sales, with the highest performance seen in 2022.
Total asset turnover, representing the company's overall efficiency in generating revenue from all assets, including fixed and current assets, has also shown fluctuations over the years. The ratio increased steadily from 2019 to 2021, indicating an improvement in utilizing all assets to drive sales. In 2023, the total asset turnover was 1.19, signifying that Live Nation generated $1.19 in revenue for every dollar of total assets. This improvement in efficiency suggests that the company has effectively managed its assets to drive revenue growth.
In conclusion, despite the fluctuations in the ratios over the years, Live Nation Entertainment Inc has demonstrated a strong ability to efficiently utilize both fixed and total assets to generate sales revenue, with significant improvements seen in recent years.