Motorola Solutions Inc (MSI)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 6.93 | 6.06 | 4.63 | 5.24 | 7.49 |
| Receivables turnover | — | — | — | — | — |
| Payables turnover | — | — | — | — | — |
| Working capital turnover | 7.60 | — | 13.11 | 6.06 | 8.85 |
Activity ratios provide insights into how efficiently a company manages its assets and operating cycle. Let's analyze the activity ratios of Motorola Solutions Inc based on the provided data.
1. Inventory Turnover:
- The inventory turnover ratio declined from 7.49 in 2020 to 5.24 in 2021, indicating that Motorola Solutions managed its inventory less efficiently in 2021. However, the ratio improved slightly to 6.06 in 2023 before decreasing to 4.63 in 2022 and then increasing again to 6.93 in 2024.
- The fluctuation in inventory turnover suggests variations in demand, production efficiency, or inventory management practices over the years.
2. Receivables Turnover:
- The receivables turnover data is not provided for any of the years, indicating that specific information on how efficiently Motorola Solutions collects on its receivables is not available.
- A higher receivables turnover ratio typically indicates more efficient management of receivables, with quicker collection cycles.
3. Payables Turnover:
- Similar to receivables turnover, payables turnover data is not available for any year, making it challenging to assess the effectiveness of managing payables.
4. Working Capital Turnover:
- The working capital turnover ratio fluctuated significantly over the years, with values of 8.85 in 2020, 6.06 in 2021, 13.11 in 2022, and 7.60 in 2024. However, data for 2023 is missing.
- The higher working capital turnover ratio in 2022 indicates that Motorola Solutions generated $13.11 in revenue for every dollar of working capital invested, suggesting efficient utilization of the company's working capital to generate sales.
In conclusion, while the inventory turnover ratio showed fluctuations, the lack of data for receivables and payables turnover limits our ability to fully assess the efficiency of Motorola Solutions Inc's management of these assets. The varying trends in activity ratios highlight the importance of monitoring these metrics to identify areas for improvement in asset management and operational efficiency.
Average number of days
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 52.70 | 60.27 | 78.86 | 69.62 | 48.72 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
Based on the provided data for Motorola Solutions Inc, we can analyze the activity ratios as follows:
1. Days of Inventory on Hand (DOH):
- December 31, 2020: 48.72 days
- December 31, 2021: 69.62 days
- December 31, 2022: 78.86 days
- December 31, 2023: 60.27 days
- December 31, 2024: 52.70 days
The DOH ratio measures the average number of days a company holds inventory before it is sold. A decreasing trend in this ratio is generally favorable as it indicates that the company is selling inventory at a faster rate. In this case, Motorola Solutions Inc's DOH has fluctuated over the years but has generally shown a decreasing trend, which suggests improving inventory management efficiency.
2. Days of Sales Outstanding (DSO):
- December 31, 2020: Not provided
- December 31, 2021: Not provided
- December 31, 2022: Not provided
- December 31, 2023: Not provided
- December 31, 2024: Not provided
The DSO ratio indicates the average number of days it takes for a company to collect revenue after a sale is made. Since the DSO data is not available for Motorola Solutions Inc, it is challenging to evaluate the efficiency of the company in collecting accounts receivable.
3. Number of Days of Payables:
- December 31, 2020: Not provided
- December 31, 2021: Not provided
- December 31, 2022: Not provided
- December 31, 2023: Not provided
- December 31, 2024: Not provided
The number of days of payables ratio measures how long a company takes to pay its suppliers. However, without specific data on payables, we cannot assess Motorola Solutions Inc's payment behavior towards its suppliers.
In conclusion, based on the available data, Motorola Solutions Inc has shown improvements in its inventory management efficiency as indicated by the decreasing trend in the Days of Inventory on Hand ratio. However, without information on Days of Sales Outstanding and Number of Days of Payables, a complete assessment of the company's overall activity ratios is limited.
See also:
Motorola Solutions Inc Short-term (Operating) Activity Ratios
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | — | — | 6.45 | 5.74 | 7.25 |
| Total asset turnover | 0.74 | 0.75 | 0.71 | 0.67 | 0.68 |
Long-term activity ratios for Motorola Solutions Inc indicate the efficiency of the company in utilizing its assets over a period.
1. Fixed asset turnover:
- The fixed asset turnover ratio measures how effectively the company generates revenue from its fixed assets.
- The trend shows a decrease from 7.25 in 2020 to 5.74 in 2021, followed by an improvement to 6.45 in 2022.
- However, data for 2023 and 2024 is not available.
- The decline in 2021 may suggest potential inefficiencies in utilizing fixed assets, which improved in 2022.
- Further analysis is needed to understand the reasons for these fluctuations.
2. Total asset turnover:
- The total asset turnover ratio indicates how efficiently the company is generating revenue from all its assets.
- The ratio remained relatively stable, decreasing slightly from 0.68 in 2020 to 0.67 in 2021, then increasing to 0.71 in 2022, 0.75 in 2023, and then declining to 0.74 in 2024.
- The improvement in 2022 and 2023 indicates better asset utilization to generate sales.
- However, the decline in 2024 suggests a potential decrease in efficiency in generating revenue from total assets.
- Further analysis is required to assess the underlying factors contributing to these changes in total asset turnover over the years.
See also:
Motorola Solutions Inc Long-term (Investment) Activity Ratios