Mueller Industries Inc (MLI)

Short-term

Turnover ratios

Mueller Industries Inc's activity ratios paint a picture of the efficiency and effectiveness of the company's operations in managing its inventory, receivables, payables, and working capital over the past five years.

1. Inventory Turnover: Mueller Industries Inc's inventory turnover has fluctuated slightly over the years, ranging from 6.79 to 7.55. The company's ability to turn over its inventory indicates how well it manages its inventory levels and replenishes stock. A higher inventory turnover generally suggests more efficient inventory management.

2. Receivables Turnover: The receivables turnover ratio has shown variation, with a peak in 2022 at 10.49 and a low in 2021 at 8.08. This ratio reflects how quickly the company collects payments from its customers. A higher receivables turnover ratio indicates that the company is efficient in collecting its outstanding receivables.

3. Payables Turnover: Mueller Industries Inc's payables turnover ratio has fluctuated as well, from 14.48 to 25.74, with a high turnover indicating that the company pays its suppliers quickly. This ratio is vital for understanding how efficiently the company manages its trade credit from suppliers.

4. Working Capital Turnover: The working capital turnover ratio has shown a downward trend, with a peak of 5.99 in 2021 and a low of 1.99 in 2023. This ratio reflects how well the company generates revenue from its working capital. A higher ratio indicates more effective utilization of working capital.

Overall, an in-depth analysis of Mueller Industries Inc's activity ratios suggests that the company has generally displayed efficient management of inventory, receivables, payables, and working capital over the past five years. However, fluctuations in these ratios highlight the need for continuous monitoring and optimization of operational activities to enhance overall efficiency and profitability.

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Average number of days

Mueller Industries Inc's activity ratios provide insights into the efficiency of the company's operations over the past five years.

1. Days of Inventory on Hand (DOH):
- The trend shows some fluctuations over the years, ranging from 48.36 days in 2019 to 53.29 days in 2022.
- In 2023, the DOH decreased to 52.30 days, indicating a slightly more efficient management of inventory compared to the previous year.
- Overall, Mueller Industries Inc appears to have maintained its inventory for approximately 50-53 days on average, suggesting a reasonable balance between stocking enough inventory and not carrying excess.

2. Days of Sales Outstanding (DSO):
- The DSO ratio fluctuated significantly over the years, with the highest being 55.14 days in 2020 and the lowest at 34.80 days in 2022.
- In 2023, the DSO increased to 37.45 days, indicating a slight increase in the average number of days it takes for the company to collect revenue from its sales.
- The trend suggests that the company may have experienced challenges in collecting receivables efficiently in some years, influencing its cash flow and liquidity position.

3. Number of Days of Payables:
- The trend in the number of days of payables also shows fluctuations, ranging from 14.18 days in 2019 to 25.20 days in 2020.
- In 2023, the number of days of payables increased to 16.57 days, implying that the company took slightly longer to pay its suppliers compared to the previous year.
- This ratio indicates the average number of days it takes for Mueller Industries Inc to pay its trade payables, reflecting its relationship with suppliers and liquidity management.

Overall, these activity ratios suggest that while Mueller Industries Inc has managed its inventory reasonably well and maintained stable payment terms with suppliers, there have been fluctuations in the efficiency of collecting receivables, which could impact the company's cash flow and working capital management.

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Long-term

The long-term activity ratios for Mueller Industries Inc have shown fluctuations over the past five years. The fixed asset turnover ratio has ranged from 6.28 to 10.50, indicating the company's ability to generate sales from its fixed assets has varied. A higher fixed asset turnover ratio suggests greater efficiency in utilizing fixed assets to generate revenue. The trend shows improvement till 2022 but a slight decline in 2023.

On the other hand, the total asset turnover ratio has fluctuated between 1.24 and 2.21. This ratio reflects the company's ability to generate sales from all its assets, both fixed and current. A higher total asset turnover ratio indicates efficient utilization of all assets to generate revenue. The trend for this ratio has been more erratic, with a peak in 2021 followed by a decrease in subsequent years.

Overall, the analysis of long-term activity ratios indicates that while Mueller Industries Inc has shown varying degrees of efficiency in utilizing both fixed and total assets to generate revenue over the years, there is room for improvement in optimizing asset turnover in the long term.