Mesa Laboratories Inc (MLAB)
Activity ratios
Short-term
Turnover ratios
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 2.54 | 2.46 | 3.06 | 4.20 | 4.68 |
| Receivables turnover | 5.54 | 5.15 | 4.47 | 5.63 | 5.57 |
| Payables turnover | 13.73 | 13.92 | 9.53 | 10.49 | 15.35 |
| Working capital turnover | 3.32 | 2.90 | 2.42 | 0.49 | 1.22 |
1. Inventory Turnover:
- Mesa Laboratories Inc's inventory turnover has been gradually decreasing over the past five years, from 4.68 in 2020 to 2.54 in 2024.
- This indicates that the company is selling its inventory at a slower rate compared to previous years, which may result in excess inventory or potential obsolescence issues.
2. Receivables Turnover:
- The receivables turnover for Mesa Laboratories Inc has fluctuated over the years, with a peak of 5.63 in 2021 and a slight decrease to 5.54 in 2024.
- A higher receivables turnover ratio indicates that the company is efficient in collecting receivables, translating to faster cash conversions from credit sales.
3. Payables Turnover:
- Mesa Laboratories Inc's payables turnover has shown variability, with fluctuations between 9.53 in 2022 to 15.35 in 2020.
- A higher payables turnover ratio suggests that the company is taking longer to pay its suppliers, potentially benefiting from favorable credit terms.
4. Working Capital Turnover:
- The working capital turnover ratio for Mesa Laboratories Inc has been inconsistent, ranging from 0.49 in 2021 to 3.32 in 2024.
- A higher working capital turnover ratio indicates that the company is efficiently utilizing its working capital to generate sales revenue, reflecting strong operational efficiency.
Overall, Mesa Laboratories Inc's activity ratios reflect fluctuations in the efficiency of managing its inventory, receivables, payables, and working capital over the past five years. Monitoring these ratios can provide insights into the company's operational performance and potential areas for improvement in managing its resources effectively.
Average number of days
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 143.80 | 148.08 | 119.36 | 86.95 | 77.97 |
| Days of sales outstanding (DSO) | days | 65.94 | 70.89 | 81.63 | 64.82 | 65.54 |
| Number of days of payables | days | 26.59 | 26.22 | 38.31 | 34.79 | 23.77 |
The activity ratios of Mesa Laboratories Inc provide insights into the efficiency of the company's operations in managing inventory, accounts receivable, and accounts payable.
- Days of Inventory on Hand (DOH) has shown an increasing trend from 77.97 days in 2020 to 143.80 days in 2024. This indicates that the company is taking longer to sell its inventory, which could suggest overstocking or slow-moving inventory.
- Days of Sales Outstanding (DSO) has fluctuated over the years, with a decrease from 65.54 days in 2020 to 65.94 days in 2024. This implies that the company is collecting its receivables more efficiently in recent years.
- The Number of Days of Payables has also fluctuated, with an increasing trend from 23.77 days in 2020 to 26.59 days in 2024. This suggests that the company is taking longer to pay its suppliers, which could be beneficial for cash flow management but may strain supplier relationships.
Overall, Mesa Laboratories Inc's activity ratios reflect mixed efficiency in managing inventory, accounts receivable, and accounts payable. It may be advisable for the company to further analyze its inventory management practices to optimize stock levels and improve the cash conversion cycle.
Long-term
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 6.81 | 7.78 | 6.44 | 6.09 | 5.33 |
| Total asset turnover | 0.48 | 0.33 | 0.26 | 0.22 | 0.29 |
Mesa Laboratories Inc's long-term activity ratios indicate its efficiency in managing fixed and total assets over the past five years. The fixed asset turnover ratio has shown a decreasing trend from 2017 to 2021, with a slight increase in 2022 and a further decline in 2023. This ratio measures how efficiently the company generates sales from its fixed assets, and a higher ratio is generally more favorable. Mesa Labs' fixed asset turnover ratio has ranged from 5.33 to 7.78, suggesting that the company has been effective in utilizing its fixed assets to generate revenue.
On the other hand, the total asset turnover ratio has shown significant fluctuations over the same period. This ratio evaluates the company's ability to generate sales from all its assets, including fixed and current assets. Mesa Labs' total asset turnover ratio has ranged from 0.22 to 0.48, reaching its peak in 2024. A higher total asset turnover ratio signifies better asset utilization and efficiency in generating revenue.
Overall, Mesa Laboratories Inc has demonstrated improvements in its utilization of both fixed and total assets over the years, as indicated by the increasing fixed asset turnover ratio and the fluctuating but generally improving trend in the total asset turnover ratio. These ratios suggest that the company has been successful in optimizing its asset base to drive revenue growth.