National HealthCare Corporation (NHC)

Short-term

Turnover ratios

The activity ratios of National Healthcare Corp. over the past five years reflect the efficiency of the company in managing its resources and operations.

1. Inventory turnover: The inventory turnover ratio indicates how many times a company's inventory is sold and replaced over a period. The consistent value of 0.00 over the years suggests that either the company has very low inventory levels compared to its sales or there may be an issue with managing inventory efficiently.

2. Receivables turnover: The receivables turnover ratio measures how efficiently a company collects payments from its customers. National Healthcare Corp. demonstrated a stable receivables turnover ratio ranging from 10.25 to 10.79 over the past five years. This consistency indicates that the company is effective in managing its accounts receivable and collecting payments in a timely manner.

3. Payables turnover: The payables turnover ratio evaluates how efficiently a company manages its accounts payable. The consistent value of 0.00 suggests that the company may not have significant payables or that it may not be utilizing trade credit effectively.

4. Working capital turnover: The working capital turnover ratio shows how efficiently a company is utilizing its working capital to generate sales. The values ranging from 5.57 to 6.88 indicate that National Healthcare Corp. has been effectively using its working capital to support its revenue-generating activities over the years.

Overall, while the company's performance in managing receivables and working capital appears robust, there are areas of improvement needed in inventory management and potentially payables turnover to enhance overall efficiency.

---

Average number of days

The Days of Sales Outstanding (DSO) ratio for National Healthcare Corp. has been relatively stable over the past five years, ranging from 33.81 to 35.62 days. This indicates that, on average, it takes the company around 34 days to collect its accounts receivable from customers. A lower DSO is generally favorable as it suggests faster cash conversion.

However, without information on the Days of Inventory on Hand (DOH) and Days of Payables, it is challenging to provide a comprehensive analysis of the company's overall activity ratios. DOH would indicate how efficiently the company manages its inventory, while Days of Payables would show how quickly the company pays its suppliers.

Overall, a combination of these ratios would provide a more complete picture of National Healthcare Corp.'s operating efficiency and cash flow management.

---

Long-term

The long-term activity ratios for National Healthcare Corp. provide insights into how efficiently the company is utilizing its fixed assets and total assets to generate revenue over a period of five years.

1. Fixed Asset Turnover:
- The fixed asset turnover ratio has generally been increasing over the past five years, reflecting an improvement in the company's ability to generate sales from its fixed assets.
- In 2023, the fixed asset turnover ratio reached 2.30, indicating that for every dollar invested in fixed assets, the company generated $2.30 in revenue. This suggests that National Healthcare Corp. has been effectively utilizing its fixed assets to drive sales growth.
- The consistent increase in the fixed asset turnover ratio from 2019 to 2023 indicates that the company has been efficiently managing and utilizing its fixed assets to generate higher revenue.

2. Total Asset Turnover:
- The total asset turnover ratio measures the company's ability to generate sales from all its assets, including fixed and current assets.
- The total asset turnover ratio has shown fluctuations over the past five years but has generally trended upwards. In 2023, the ratio stood at 0.87, indicating that for every dollar in total assets, the company generated $0.87 in revenue.
- The increasing trend in the total asset turnover ratio suggests that National Healthcare Corp. has been improving its overall asset utilization efficiency, leading to higher revenue generation.

Overall, the upward trends in both the fixed asset turnover and total asset turnover ratios demonstrate that National Healthcare Corp. has been effectively managing and utilizing its assets to drive revenue growth and improve efficiency in generating sales. These ratios indicate a positive trend in the company's long-term asset management and operational performance.