Macy’s Inc (M)

Short-term

Turnover ratios

Inventory turnover for Macy's Inc has ranged from 4.76 to 6.06 over the past five years, indicating a moderate ability to sell through its inventory efficiently. The receivables turnover ratio has been consistently high, ranging from 59.88 to 84.83, suggesting that Macy's collects its accounts receivable quickly. The payables turnover has fluctuated between 10.49 and 14.69, indicating the speed at which Macy's pays its suppliers.

The working capital turnover ratio has fluctuated over the years, ranging from 14.39 to 25.65, which reflects how efficiently Macy's is utilizing its working capital to generate sales. Overall, Macy's has shown relatively stable performance in terms of activity ratios, with occasional fluctuations in working capital turnover.

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Average number of days

Days of Inventory on Hand (DOH) for Macy's Inc have ranged from 60.22 days in 2021 to 76.64 days in 2020. The decrease in DOH from 2020 to 2021 indicates that Macy's has been managing its inventory more efficiently, holding inventory for a shorter period before selling it.

Days of Sales Outstanding (DSO) have declined from 6.10 days in 2020 to 4.48 days in 2024. This trend suggests that Macy's has been collecting its accounts receivable more quickly, which is positive for its cash flow and liquidity.

The Number of Days of Payables for Macy's has varied from 24.85 days in 2020 to 34.80 days in 2022. A higher number of days of payables indicates that Macy's is taking longer to pay its suppliers, which can improve its working capital management and cash flow.

Overall, Macy's shows improvement in managing its inventory, collecting receivables efficiently, and optimizing its payables, which reflects positively on its operational efficiency and liquidity position. Monitoring these activity ratios can help investors and stakeholders assess Macy's ability to efficiently manage its working capital and generate cash flows.

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Long-term

Macy's Inc long-term activity ratios shed light on the company's effectiveness in utilizing its resources over the years. The fixed asset turnover ratio indicates that Macy's generated $4.50 in sales for every $1 invested in fixed assets in 2024, showing a slight improvement compared to the previous year. This suggests that Macy's efficiently managed its fixed assets to support revenue generation.

On the other hand, the total asset turnover ratio declined slightly from 1.51 in 2023 to 1.47 in 2024, indicating that Macy's generated $1.47 in sales for every $1 of total assets. This could suggest that Macy's may not be generating as much revenue relative to its total asset base in the most recent year.

Overall, Macy's continues to show solid efficiency in utilizing its fixed assets to generate sales, but there may be room for improvement in leveraging its total asset base to drive revenue growth. Monitoring these ratios over time can provide valuable insights into Macy's operational efficiency and asset utilization strategies.