MasterBrand Inc. (MBC)

Short-term

Turnover ratios

MasterBrand Inc.'s inventory turnover ratio shows a decreasing trend throughout the year, from 7.20 in March to 6.60 in December, indicating a decline in the number of times the inventory was sold and replaced during the year. This may suggest potential issues with managing and selling inventory efficiently.

On the other hand, the receivables turnover ratio increased from 11.98 in March to 14.14 in December, indicating that the company is collecting its accounts receivable more frequently as the year progressed. This is a positive sign as it shows efficient management of credit and collection processes.

The payables turnover ratio remained relatively stable around 10 throughout the year, which indicates that the company is taking about 10 days to pay its suppliers on average. This consistency in payment terms may reflect a good relationship with suppliers.

Lastly, the working capital turnover ratio shows an increasing trend, starting at 7.42 in March and reaching 10.58 in December. This indicates that the company is generating more revenue relative to its working capital, which can be seen as a positive sign of operational efficiency and effective utilization of resources.

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Average number of days

Based on the provided data, we can analyze MasterBrand Inc.'s activity ratios as follows:

1. Days of Inventory on Hand (DOH):
- In March 31, 2024, MasterBrand had 50.66 days of inventory on hand, which increased to 55.59 days by June 30, 2024. The trend continued to September 30, 2024, with 60.28 days of inventory on hand, before decreasing to 55.33 days by December 31, 2024.
- An increasing trend in days of inventory on hand indicates that MasterBrand is taking longer to sell its inventory, which could suggest inefficiencies in inventory management or a decrease in demand for its products.

2. Days of Sales Outstanding (DSO):
- MasterBrand's days of sales outstanding, a measure of how long it takes for the company to collect payment from its customers, decreased from 30.48 days on March 31, 2024, to 25.82 days on December 31, 2024.
- A decreasing trend in DSO indicates that MasterBrand is collecting payments from its customers more quickly, which could be a positive sign of effective credit management and customer payment collection practices.

3. Number of Days of Payables:
- The number of days of payables, which measures how long it takes for MasterBrand to pay its suppliers, slightly increased from 33.43 days on March 31, 2024, to 36.17 days on December 31, 2024.
- An increase in the days of payables suggests that MasterBrand is taking longer to settle its payables, which could indicate potential cash flow management strategies or negotiations with suppliers to extend payment terms.

Overall, a thorough analysis of MasterBrand Inc.'s activity ratios reveals insights into the company's inventory management, accounts receivable collection efficiency, and accounts payable settlement practices, which are essential factors in assessing its operational performance and financial health.

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Long-term

MasterBrand Inc.'s fixed asset turnover ratio measures its ability to generate sales from its investment in fixed assets. The company's fixed asset turnover has been relatively stable over the year, ranging from 5.61 to 7.78. This indicates that for every dollar invested in fixed assets, MasterBrand Inc. generated between $5.61 and $7.78 in sales during the year.

On the other hand, the total asset turnover ratio represents the company's efficiency in generating sales from its total assets. MasterBrand Inc.'s total asset turnover has also been consistent, at around 0.92 to 1.12. This suggests that the company generated between $0.92 and $1.12 in sales for every dollar invested in total assets.

Overall, MasterBrand Inc.'s long-term activity ratios show a stable performance in utilizing its assets to generate sales over the year, with both fixed asset turnover and total asset turnover ratios staying within a relatively narrow range.