Monster Beverage Corp (MNST)

Activity ratios

Short-term

Turnover ratios

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Inventory turnover	4.18	4.39	4.48	4.18	3.98	4.18	3.88	3.88	5.01	5.83	6.91	6.67	7.08	7.22	6.60	6.40	6.09	7.11	7.36	7.16
Receivables turnover	5.93	5.59	4.99	5.42	6.17	5.92	5.11	5.59	6.18	6.26	5.66	5.96	6.90	5.97	5.66	6.44	7.77	6.34	5.80	8.24
Payables turnover	7.19	7.19	6.68	7.71	8.39	6.94	6.97	7.26	7.35	6.94	7.29	7.35	7.94	8.18	8.58	7.38	8.02	7.41	7.53	8.04
Working capital turnover	1.60	1.67	1.48	1.57	1.67	1.74	1.67	1.57	1.49	1.54	1.68	1.81	1.92	2.15	2.54	3.20	2.54	2.49	2.46	3.85

The activity ratios of Monster Beverage Corp. provide insights into how efficiently the company manages its assets and operations.

1. Inventory turnover: The company's inventory turnover has been relatively stable over the past eight quarters, ranging from 3.22 to 3.78. This indicates that Monster Beverage is able to sell and replace its inventory approximately 3 to 4 times a year. A higher inventory turnover ratio signifies efficient inventory management.

2. Receivables turnover: Monster Beverage's receivables turnover has fluctuated between 5.02 and 6.21 over the last two years. This ratio shows how quickly the company collects its accounts receivable. A higher receivables turnover ratio indicates that the company is effective in collecting payments from customers.

3. Payables turnover: The payables turnover ratio for Monster Beverage has ranged from 5.63 to 7.06, demonstrating how quickly the company pays its suppliers. A higher payables turnover ratio suggests that Monster Beverage is able to manage its payables efficiently.

4. Working capital turnover: The working capital turnover ratio has varied between 1.49 and 1.74, reflecting how efficiently Monster Beverage utilizes its working capital to generate sales revenue. A higher working capital turnover ratio indicates effective management of working capital.

Overall, Monster Beverage Corp. has maintained relatively stable activity ratios, which suggest effective management of its inventory, receivables, payables, and working capital. Tracking these ratios over time can help assess the company's operational efficiency and performance.

Average number of days

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Days of inventory on hand (DOH)	days	87.40	83.07	81.41	87.41	91.67	87.28	94.12	94.15	72.91	62.60	52.83	54.74	51.59	50.56	55.28	57.00	59.89	51.37	49.62	50.97
Days of sales outstanding (DSO)	days	61.56	65.27	73.13	67.32	59.13	61.68	71.41	65.26	59.06	58.34	64.46	61.27	52.86	61.18	64.45	56.70	46.95	57.58	62.95	44.28
Number of days of payables	days	50.78	50.76	54.66	47.36	43.53	52.61	52.36	50.25	49.67	52.60	50.07	49.64	45.97	44.63	42.53	49.43	45.50	49.27	48.48	45.37

Monster Beverage Corp.'s activity ratios provide insights into the effectiveness of the company's management of inventory, receivables, and payables.

Days of inventory on hand (DOH) indicates the average number of days it takes for the company to sell its inventory. Monster Beverage Corp.'s DOH has shown a decreasing trend over the quarters, from 108.88 days in Q4 2022 to 105.97 days in Q4 2023. This suggests that the company is able to sell its inventory more quickly, which could be a result of efficient inventory management or changes in demand patterns.

Days of sales outstanding (DSO) measures how long it takes for the company to collect payments from customers. Monster Beverage Corp.'s DSO has been relatively stable, ranging from 58.77 days in Q4 2022 to 72.72 days in Q2 2023. This indicates that the company has maintained a consistent collection period for its receivables over the quarters.

Number of days of payables shows how long it takes for the company to pay its suppliers. Monster Beverage Corp.'s payables period has fluctuated, with a peak of 64.84 days in Q2 2023 and a low of 51.70 days in Q4 2022. This variability may reflect changes in payment terms negotiated with suppliers or cash flow management strategies.

Overall, Monster Beverage Corp.'s activity ratios suggest that the company has been improving its inventory turnover, maintaining a stable collection period for receivables, and managing payables effectively. Further analysis and comparison with industry benchmarks could provide more insights into the company's efficiency in managing its working capital.

Long-term

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Fixed asset turnover	7.95	9.42	11.54	11.82	12.14	12.82	12.94	14.28	17.66	17.16	16.65	15.31	14.61	14.51	14.26	14.61	14.07	16.32	16.62	20.39
Total asset turnover	0.73	0.74	0.72	0.73	0.76	0.76	0.74	0.71	0.71	0.71	0.73	0.73	0.74	0.78	0.83	0.88	0.82	0.80	0.78	1.06

The fixed asset turnover ratio measures how efficiently a company utilizes its fixed assets to generate revenue. In the case of Monster Beverage Corp., the fixed asset turnover ratio has shown a decreasing trend over the past eight quarters. This indicates that the company's fixed assets are less effective in generating sales compared to previous periods. The sharp decline from Q4 2022 to Q1 2023 is a cause for concern as it signifies a significant drop in the utilization of fixed assets.

On the other hand, the total asset turnover ratio reflects the company's ability to generate sales relative to its total assets. Monster Beverage Corp.'s total asset turnover ratio has remained relatively stable over the same period, hovering around 0.74 to 0.76. This suggests that the company has maintained its efficiency in generating revenues from its total assets, which include both fixed and current assets.

Overall, the decline in fixed asset turnover coupled with the stable total asset turnover indicates a shift in the company's asset utilization towards a less efficient use of fixed assets. This may be a result of changes in production processes, asset mix, or other operational factors that are impacting the company's ability to generate revenue from its fixed assets. Further investigation into the underlying reasons for this trend is recommended to assess the long-term implications for Monster Beverage Corp.'s operational efficiency and profitability.