Mativ Holdings Inc. (MATV)

Short-term

Turnover ratios

The activity ratios for Mativ Holdings Inc indicate how efficiently the company is managing its assets and liabilities to generate sales.

1. Inventory Turnover:
- The inventory turnover ratio shows how many times the company's inventory is sold and replaced within a given period.
- Mativ's inventory turnover has fluctuated over the past five years, ranging from 3.23 to 4.73.
- The increase in 2023 compared to 2022 indicates that Mativ is selling its inventory at a faster rate, which could be a positive sign of effective inventory management.

2. Receivables Turnover:
- The receivables turnover ratio measures how quickly the company collects its accounts receivable.
- Mativ's receivables turnover has generally been increasing over the years, from 5.81 in 2021 to 9.78 in 2023.
- The higher turnover ratios suggest that Mativ has been collecting its receivables more efficiently, potentially improving its cash flow and liquidity.

3. Payables Turnover:
- The payables turnover ratio reflects how quickly the company pays its suppliers.
- Mativ's payables turnover has also shown variability, with an increase from 7.66 in 2022 to 11.99 in 2023.
- A higher payables turnover ratio may indicate that Mativ is managing its payables effectively, possibly negotiating better payment terms with suppliers.

4. Working Capital Turnover:
- The working capital turnover ratio measures how efficiently the company utilizes its working capital to generate sales.
- Mativ's working capital turnover has been relatively stable over the years, ranging between 3.79 to 4.70.
- A higher working capital turnover ratio indicates that Mativ is effectively using its working capital resources to generate revenue.

Overall, the trend in activity ratios for Mativ Holdings Inc reflects improvements in inventory management, receivables collection, and payables handling over the years. These positive trends suggest that Mativ is becoming more efficient in managing its assets and liabilities to support its sales growth.

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Average number of days

Based on the activity ratios provided for Mativ Holdings Inc over the years 2019 to 2023, the following trends can be observed:

1. Days of Inventory on Hand (DOH):
- The Days of Inventory on Hand have shown fluctuation over the years, ranging from 77.12 days in 2023 to 112.87 days in 2022. This ratio measures how many days, on average, Mativ Holdings takes to sell its inventory. A decrease in this ratio indicates a more efficient management of inventory, while an increase may signal potential issues with inventory control or demand forecasting.

2. Days of Sales Outstanding (DSO):
- The Days of Sales Outstanding have also varied, with values ranging from 37.31 days in 2023 to 62.86 days in 2021. This ratio reflects the average number of days it takes for Mativ Holdings to collect its accounts receivable. A lower DSO is desirable as it indicates a faster collection of receivables and better liquidity management.

3. Number of Days of Payables:
- The Number of Days of Payables has shown some fluctuations as well, from 30.44 days in 2023 to 47.62 days in 2022. This ratio represents how long it takes for Mativ Holdings to pay its suppliers. A longer payable period may indicate favorable creditor terms, but could also suggest potential liquidity issues or strained relationships with suppliers.

Overall, analyzing these activity ratios in conjunction can provide insights into Mativ Holdings' operational efficiency, inventory management, collection policies, and payment practices. It is important for the company to monitor these ratios regularly to ensure optimal working capital management and sustainable growth.

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Long-term

The fixed asset turnover ratio of Mativ Holdings Inc has ranged from 2.48 to 3.17 over the past five years, indicating a consistent ability to generate sales revenue from its fixed assets. A higher fixed asset turnover ratio suggests that the company is effectively utilizing its fixed assets to generate sales.

On the other hand, the total asset turnover ratio has ranged from 0.59 to 0.77 during the same period, reflecting the company's ability to generate sales relative to its total assets. The company has shown some variability in this ratio, which may indicate fluctuations in the efficiency of utilizing its total assets to generate revenue.

Overall, Mativ Holdings Inc has generally demonstrated efficiency in generating sales revenue from both its fixed assets and total assets over the past five years, with the fixed asset turnover ratio consistently higher than the total asset turnover ratio. This suggests that the company has effectively managed its asset utilization in a way that maximizes sales generation.