Neogen Corporation (NEOG)

Short-term

Turnover ratios

Neogen Corporation's inventory turnover ratio has shown some fluctuations over the period under review, ranging from 2.22 to 3.26. Generally, a higher inventory turnover indicates more efficient management of inventory as it reflects how many times a company sells and replaces its inventory during a period.

The receivables turnover for Neogen Corporation is not available, as indicated by the blank values. Receivables turnover measures how efficiently a company is able to collect on its credit sales. Absence of this data makes it challenging to assess the effectiveness of the company's credit management policies.

Similarly, payables turnover data is unavailable for Neogen Corporation across the periods provided. Payables turnover ratio helps in assessing how quickly a company pays its suppliers. The absence of this data restricts the analysis of the company's payables management efficiency.

The working capital turnover ratio for Neogen Corporation has been steadily increasing from 0.86 to 2.21 over the period, highlighting the company's ability to generate sales relative to its working capital. A higher working capital turnover ratio is generally favorable as it indicates efficient use of working capital to generate revenue.

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Average number of days

Neogen Corporation's Days of Inventory on Hand (DOH) indicates the average number of days it takes for the company to sell its inventory. Over the past few years, Neogen has displayed fluctuations in its inventory management efficiency, with the DOH ranging from as low as 111.97 days to as high as 164.72 days. In recent periods, there seems to be an improving trend in inventory management efficiency, as the DOH has decreased to 150.07 days as of May 31, 2024.

Regarding Days of Sales Outstanding (DSO), the data provided does not contain any information for this metric, indicating that Neogen Corporation's credit sales collection period is unknown. This lack of data restricts the ability to assess the company's effectiveness in collecting outstanding receivables.

Similarly, information on the Number of Days of Payables is unavailable in the dataset, making it challenging to evaluate Neogen's payment terms with suppliers and the efficiency of managing payables.

In summary, based on the available data, Neogen Corporation has showcased improvements in inventory management efficiency over the years. However, the lack of information on DSO and payables hinders a comprehensive analysis of the company's overall activity ratios.

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Long-term

Neogen Corporation's fixed asset turnover ratio has exhibited a decreasing trend over the past several reporting periods, declining from 5.32 as of May 31, 2020, to 4.37 as of February 28, 2023. This ratio measures the efficiency with which the company is generating sales relative to its investment in fixed assets. The decreasing trend indicates that Neogen is generating fewer sales per dollar invested in fixed assets over time, suggesting potential inefficiencies or underutilization of these assets.

On the other hand, the total asset turnover ratio has shown some fluctuations but generally remained relatively stable until November 30, 2022. However, from November 30, 2022, the ratio decreased significantly from 0.54 to 0.22 as of February 28, 2025. This ratio reflects the company's ability to generate sales from its total assets. The sharp decline in total asset turnover implies that Neogen is generating fewer sales relative to its total assets, which could be a cause for concern regarding the company's overall asset utilization efficiency.

Overall, the deteriorating trends in both fixed asset turnover and total asset turnover ratios may indicate inefficiencies in Neogen Corporation's asset management and utilization. Further investigation and analysis of the reasons behind these declining ratios would be necessary to assess the impact on the company's operational performance and financial health.