Maximus Inc (MMS)
Activity ratios
Short-term
Turnover ratios
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | — | — | — | — | — |
| Receivables turnover | 6.03 | 5.93 | 5.74 | 5.10 | 4.40 |
| Payables turnover | — | — | — | — | — |
| Working capital turnover | 13.50 | 14.75 | 17.96 | 14.67 | 9.32 |
The activity ratios for Maximus Inc over the past five years provide valuable insights into the efficiency of the company's operations:
1. Receivables Turnover:
- The receivables turnover ratio has shown a consistent improvement over the past five years, indicating that Maximus Inc is collecting its receivables more frequently each year.
- This suggests that the company is managing its credit policies effectively and efficiently converting credit sales into cash.
- The increase in receivables turnover from 4.40 in 2020 to 6.03 in 2024 is a positive trend, reflecting better working capital management.
2. Working Capital Turnover:
- The working capital turnover ratio measures how effectively a company utilizes its working capital to generate sales revenue.
- Maximus Inc has shown fluctuations in its working capital turnover ratio over the years. The highest ratio was observed in 2022 at 17.96, indicating that the company generated $17.96 in revenue for every dollar of working capital.
- The decrease in working capital turnover in 2024 compared to 2022 suggests a potential decrease in efficiency in utilizing working capital to generate revenue.
3. Inventory Turnover and Payables Turnover:
- The absence of data for inventory turnover and payables turnover ratios limits the comprehensive assessment of Maximus Inc's efficiency in managing inventory and paying its suppliers.
- Calculating and monitoring these ratios would provide additional insights into inventory management and payment terms negotiated with suppliers.
In summary, Maximus Inc has shown improvements in receivables turnover over the years, which reflects effective credit management. The fluctuations in working capital turnover signal varying efficiency in utilizing working capital. Monitoring inventory turnover and payables turnover ratios would provide a more complete picture of the company's operational efficiency.
Average number of days
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | 60.50 | 61.53 | 63.61 | 71.62 | 82.90 |
| Number of days of payables | days | — | — | — | — | — |
Days of sales outstanding (DSO) measures how long, on average, it takes for Maximus Inc to collect its accounts receivables. A decreasing trend in DSO over the past five years from 82.90 days in 2020 to 60.50 days in 2024 indicates that the company has been improving its efficiency in collecting payment from its customers, which is a positive sign.
Days of inventory on hand (DOH) is not available in the provided data for all years. DOH measures how long, on average, Maximus Inc holds onto its inventory before it is sold. Without this information, it is challenging to assess the efficiency of the company's inventory management.
The number of days of payables is not provided, limiting the ability to analyze Maximus Inc's payment policies and the time it takes the company to pay its suppliers.
In conclusion, based on the DSO trend, Maximus Inc has shown improvements in accounts receivable management efficiency over the past five years. However, a more comprehensive analysis would be possible with additional information on inventory management and payables.
Long-term
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 136.14 | 126.31 | 88.62 | 67.93 | 51.88 |
| Total asset turnover | 1.28 | 1.23 | 1.16 | 1.03 | 1.71 |
The long-term activity ratios of Maximus Inc indicate the company's efficiency in utilizing its fixed assets and total assets to generate sales over the five-year period.
The fixed asset turnover ratio has exhibited an increasing trend from 51.88 in 2020 to 136.14 in 2024. This indicates that Maximus Inc has significantly improved its ability to generate sales using its fixed assets efficiently. A higher fixed asset turnover ratio implies that the company is generating more revenue per dollar invested in fixed assets, reflecting operational efficiency and effective asset utilization.
On the other hand, the total asset turnover ratio has fluctuated over the same period. The ratio decreased from 1.71 in 2020 to 1.03 in 2021 but then steadily increased to 1.28 in 2024. This fluctuation could indicate changes in the company's revenue generation relative to its total assets. A higher total asset turnover ratio suggests that Maximus Inc is efficient in generating sales relative to its total asset base.
Overall, the upward trend in the fixed asset turnover ratio and the recent improvement in the total asset turnover ratio indicate that Maximus Inc has been enhancing its operational efficiency and asset utilization, which bodes well for the company's long-term financial performance.