Marathon Digital Holdings Inc (MARA)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | — | 47.83 | 36.88 | 4.83 | 0.11 |
| Receivables turnover | — | — | 6,541.83 | 4.96 | 0.06 |
| Payables turnover | 119.86 | 59.74 | 313.40 | 21.43 | — |
| Working capital turnover | 1.75 | 0.39 | 0.47 | 0.22 | 0.02 |
Marathon Digital Holdings Inc's activity ratios show significant improvements over the years.
1. Inventory turnover has increased rapidly from 0.11 in 2020 to 47.83 in 2023, indicating that the company is managing its inventory more efficiently, possibly due to better inventory control or increased sales.
2. Receivables turnover has also shown a remarkable increase, from 0.06 in 2020 to 6,541.83 in 2022. While such a high turnover ratio in 2022 may be an outlier or due to specific circumstances, it suggests that the company is collecting its receivables much faster, which could improve cash flow and reduce the risk of bad debts.
3. Payables turnover has followed a similar trend, with notable increases from 21.43 in 2021 to 119.86 in 2024. This indicates that Marathon Digital Holdings Inc is paying its suppliers more efficiently, which could lead to better supplier relationships and cash management.
4. Working capital turnover has also improved significantly from 0.02 in 2020 to 1.75 in 2024. This suggests that the company is generating more revenue for each dollar of working capital invested, reflecting increased operational efficiency and potentially better liquidity management.
Overall, the trend of improving activity ratios over the years reflects positively on Marathon Digital Holdings Inc's operational performance and efficiency in managing its resources effectively.
Average number of days
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | 7.63 | 9.90 | 75.51 | 3,422.59 |
| Days of sales outstanding (DSO) | days | — | — | 0.06 | 73.54 | 6,293.81 |
| Number of days of payables | days | 3.05 | 6.11 | 1.16 | 17.03 | — |
Based on the provided data for Marathon Digital Holdings Inc, we can analyze the activity ratios as follows:
1. Days of Inventory on Hand (DOH):
- The DOH ratio reflects the number of days it takes for the company to sell its inventory.
- In December 31, 2020, the company had a significantly high DOH of 3,422.59 days, indicating slow inventory turnover.
- However, this ratio improved drastically over the years, reaching 7.63 days by December 31, 2023, which signifies a more efficient management of inventory levels. It's worth noting that the data for December 31, 2024, is missing.
2. Days of Sales Outstanding (DSO):
- The DSO ratio measures how quickly the company collects its accounts receivable.
- Marathon Digital Holdings Inc had a DSO of 6,293.81 days as of December 31, 2020, which is unusually high, indicating a slow collection of receivables.
- The DSO improved significantly over time, reaching 0.06 days by December 31, 2022, which suggests a more efficient collection process. Data for the later years is not available.
3. Number of Days of Payables:
- This ratio indicates the number of days it takes for the company to pay its suppliers.
- Data shows that the company did not have payable days in 2020, possibly indicating immediate payment terms.
- From 2021 to 2024, the number of days of payables increased gradually, indicating a more strategic approach to managing payment terms and optimizing cash flow.
In summary, Marathon Digital Holdings Inc significantly improved its efficiency in managing inventory and collecting receivables over the years. The company also adjusted its payment terms with suppliers to balance working capital requirements. Monitoring these activity ratios is crucial for assessing the company's operational performance and efficiency in managing its working capital.
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 0.42 | 0.58 | 0.43 | 0.54 | 0.25 |
| Total asset turnover | 0.10 | 0.19 | 0.10 | 0.10 | 0.01 |
The fixed asset turnover ratio for Marathon Digital Holdings Inc displays an increase from 0.25 in 2020 to 0.54 in 2021, followed by a decrease to 0.43 in 2022, a subsequent rise to 0.58 in 2023, and a decline to 0.42 in 2024. This ratio indicates the company's efficiency in generating revenue from its investment in fixed assets such as property, plant, and equipment.
On the other hand, the total asset turnover ratio remained relatively low at 0.01 in 2020, but experienced a significant improvement to 0.10 in 2021 and maintained this level in 2022 and 2024. In 2023, the total asset turnover ratio increased notably to 0.19, reflecting a higher level of sales generated from total assets.
Overall, the trend in the fixed asset turnover ratio suggests fluctuating performance in utilizing fixed assets to generate revenue, while the total asset turnover ratio indicates an enhancement in overall asset utilization efficiency over the years, albeit with some variability. Further analysis of the company's operations and asset management strategies could provide insights into the underlying factors driving these ratios.