NetScout Systems Inc (NTCT)
Activity ratios
Short-term
Turnover ratios
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 13.30 | 12.42 | 7.59 | 9.74 | 10.90 |
| Receivables turnover | 4.32 | 6.36 | 5.77 | 4.20 | 4.18 |
| Payables turnover | 12.92 | 13.54 | 9.75 | 12.36 | 12.11 |
| Working capital turnover | 2.99 | 5.58 | 1.92 | 2.67 | 3.42 |
Inventory turnover measures the efficiency of NetScout Systems Inc in managing its inventory. The trend shows an improvement from 7.59 in 2022 to 13.30 in 2024, indicating that the company is selling and restocking its inventory more frequently.
Receivables turnover reflects how quickly the company collects on credit sales. A decrease from 6.36 in 2023 to 4.32 in 2024 signals that NetScout may be taking longer to collect payments from customers compared to the previous year.
Payables turnover demonstrates how efficiently the company pays its suppliers. The trend in this ratio is relatively stable, with a slight decrease from 13.54 in 2023 to 12.92 in 2024, indicating that NetScout is maintaining a consistent payment pattern.
Working capital turnover measures the efficiency of NetScout's working capital management. A decrease from 5.58 in 2023 to 2.99 in 2024 suggests that the company is generating less revenue relative to its working capital, potentially due to changes in sales or operating expenses.
Average number of days
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 27.45 | 29.38 | 48.09 | 37.49 | 33.50 |
| Days of sales outstanding (DSO) | days | 84.53 | 57.41 | 63.24 | 86.81 | 87.39 |
| Number of days of payables | days | 28.25 | 26.95 | 37.42 | 29.52 | 30.15 |
In analyzing NetScout Systems Inc's activity ratios, we can see the following trends:
1. Days of Inventory on Hand (DOH):
- NetScout Systems Inc's efficiency in managing its inventory has improved over the five-year period. The company has significantly reduced its Days of Inventory on Hand from 48.09 days in 2022 to 27.45 days in 2024. This suggests that the company is managing its inventory more effectively, avoiding excess and obsolete inventory.
2. Days of Sales Outstanding (DSO):
- NetScout Systems Inc's Days of Sales Outstanding have fluctuated over the five-year period, with a peak of 87.39 days in 2020 and a low of 57.41 days in 2023. In 2024, the DSO increased to 84.53 days, indicating that the company is taking longer to collect its accounts receivable. This could potentially impact the company's cash flow and liquidity.
3. Number of Days of Payables:
- The number of Days of Payables for NetScout Systems Inc has also fluctuated over the period but has generally remained in a manageable range. The company extended its payment period from 26.95 days in 2023 to 28.25 days in 2024. This suggests that the company may be taking longer to pay its suppliers, potentially improving its cash flow position.
Overall, NetScout Systems Inc has improved its inventory management efficiency, but its collection of accounts receivable has weakened in the most recent period. The company's management of payables has remained relatively consistent. Monitoring these activity ratios can provide insight into the company's operational efficiency and effectiveness in managing its working capital.
Long-term
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 31.32 | 26.33 | 20.70 | 17.15 | 15.45 |
| Total asset turnover | 0.32 | 0.32 | 0.27 | 0.27 | 0.29 |
The fixed asset turnover ratio for NetScout Systems Inc has been steadily increasing over the past five years, indicating improved efficiency in generating revenue from its fixed assets. This suggests that the company is effectively utilizing its long-term assets to generate sales.
On the other hand, the total asset turnover ratio has remained relatively stable over the same period, hovering around 0.30. While this ratio is lower compared to the fixed asset turnover, it indicates that the company is generating sales in relation to its total assets consistently over the years.
Overall, the company's long-term activity ratios demonstrate a positive trend in terms of asset utilization, with the fixed asset turnover showing a significant improvement and the total asset turnover staying relatively constant. This indicates that NetScout Systems Inc has been effectively managing and utilizing its long-term assets to generate sales and optimize its overall asset efficiency.