Madison Square Garden Sports Corp (MSGS)

Short-term

Turnover ratios

The activity ratios for Madison Square Garden Sports Corp provide insights into how efficiently the company manages its assets and liabilities.

1. Inventory Turnover:
- The inventory turnover ratio measures how many times a company sells and replaces its inventory during a specific period.
- Over the past five years, Madison Square Garden Sports Corp's inventory turnover has fluctuated, with a peak in 2022 at 39.33 and a low in 2021 at 20.90.
- A high inventory turnover ratio indicates that the company is selling its inventory quickly, which may be favorable as it reduces the risk of obsolete inventory.

2. Receivables Turnover:
- The receivables turnover ratio reflects how well a company collects its outstanding accounts receivable during a period.
- Madison Square Garden Sports Corp's receivables turnover has shown a significant decrease from 97.87 in 2020 to 6.85 in 2021 and then to 13.08 in 2022.
- A lower receivables turnover ratio may suggest issues with collecting receivables promptly, potentially impacting the company's cash flow.

3. Payables Turnover:
- The payables turnover ratio measures how efficiently a company pays its suppliers.
- Madison Square Garden Sports Corp's payables turnover has decreased steadily over the past three years, from 309.07 in 2020 to 224.02 in 2021 and then to 65.68 in 2022.
- A lower payables turnover ratio could indicate changes in payment terms or relationships with suppliers.

4. Working Capital Turnover:
- The working capital turnover ratio assesses how effectively a company utilizes its working capital to generate sales revenue.
- The data provided does not include information on the working capital turnover ratio for Madison Square Garden Sports Corp.
- This ratio would have helped in evaluating the efficiency of the company's working capital management.

Overall, analyzing these activity ratios provides valuable insights into Madison Square Garden Sports Corp's operational efficiency and effectiveness in managing its inventory, receivables, and payables.

---

Average number of days

Days of inventory on hand (DOH) measures how many days, on average, a company holds its inventory before selling it. Madison Square Garden Sports Corp's DOH has fluctuated over the past five years, with a significant increase in 2022 followed by a slight decrease in 2023. This suggests that the company may have faced challenges in managing its inventory efficiently in 2022 but made improvements in 2023.

Days of sales outstanding (DSO) indicates the average number of days it takes for the company to collect revenue from its sales. Madison Square Garden Sports Corp's DSO saw a notable spike in 2021, indicating a potential issue with collecting payments from customers efficiently. However, this metric improved significantly in 2022, suggesting the company may have implemented strategies to streamline its accounts receivable processes.

Number of days of payables measures how long it takes for a company to pay its suppliers. Madison Square Garden Sports Corp's payables period remained relatively stable over the years, with a slight increase in 2022 compared to 2021. This implies that the company has not significantly adjusted its payment practices to suppliers over the years.

Overall, analyzing these activity ratios indicates that Madison Square Garden Sports Corp has made improvements in managing its inventory and collecting payments from customers efficiently. However, the company should continue to focus on optimizing its inventory turnover and accounts receivable processes to enhance its overall operational performance.

---

Long-term

Madison Square Garden Sports Corp's long-term activity ratios indicate how efficiently the company utilizes its assets to generate sales. The fixed asset turnover has been fluctuating over the past five years, with a notable increase from 15.46 in 2021 to 35.99 in 2024, suggesting an improvement in the company's ability to generate revenue from its fixed assets. This may be a result of better utilization or expansion of fixed assets.

On the other hand, the total asset turnover ratio has also shown variability but has generally increased from 0.42 in 2021 to 0.76 in 2024. This signifies that Madison Square Garden Sports Corp has been able to generate more sales revenue relative to its total assets over the years. The consistent improvement in total asset turnover may indicate effective management of both fixed and current assets to drive revenue growth.

Overall, the analysis of the long-term activity ratios suggests that Madison Square Garden Sports Corp has been making improvements in utilizing its assets efficiently to generate sales, which could lead to enhanced financial performance and profitability in the long run.