Nucor Corp (NUE)

Short-term

Turnover ratios

Based on the provided data, let's analyze the activity ratios for Nucor Corp:

1. Inventory Turnover:
- The inventory turnover ratio indicates how efficiently the company manages its inventory. A higher ratio suggests faster inventory turnover.
- Nucor Corp's inventory turnover has fluctuated over the years, with a range of 4.24 to 5.32.
- The average inventory turnover appears to be satisfactory, indicating that Nucor is effectively managing its inventory levels and turning over goods into sales within a reasonable period.

2. Receivables Turnover:
- The receivables turnover ratio measures how efficiently a company collects on its credit sales. A higher ratio implies quicker collection of receivables.
- In this case, data for Nucor Corp shows "—," indicating that information on receivables turnover is not available.
- Without specific receivables turnover data, it is challenging to assess Nucor's ability to collect outstanding receivables promptly.

3. Payables Turnover:
- The payables turnover ratio evaluates how efficiently a company pays its suppliers. A higher ratio suggests more efficient management of payables.
- Similar to receivables turnover, the data shows "—," meaning there is no information on Nucor's payables turnover.
- The absence of payables turnover data limits the analysis of Nucor's payment practices and 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.
- Nucor Corp's working capital turnover has varied from 2.94 to 4.77 across the years provided.
- A higher working capital turnover reflects efficient utilization of working capital to drive sales, indicating Nucor's ability to generate revenue from its current assets.

In conclusion, based on the available data, Nucor Corp appears to have reasonably good inventory turnover and working capital turnover ratios. However, the lack of information on receivables and payables turnover limits a comprehensive assessment of the company's overall efficiency in managing its operating cycle.

---

Average number of days

To analyze Nucor Corp's activity ratios, we will examine the Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Number of Days of Payables for the years presented in the data provided.

1. Days of Inventory on Hand (DOH):
- The DOH ratio indicates the average number of days it takes for a company to sell its entire inventory.
- In 2020, Nucor had 72.73 days' worth of inventory on hand, which increased to 86.18 days in 2021, before decreasing to 68.62 days by 2022. Subsequently, the DOH increased to 75.71 days in 2023 and slightly decreased to 69.98 days in 2024.
- Generally, a lower DOH ratio implies better inventory management efficiency, as it indicates that inventory is being sold faster.

2. Days of Sales Outstanding (DSO):
- DSO represents the average number of days it takes for a company to collect payments from its customers.
- The data provided does not include DSO values for Nucor across the years in question, which limits our ability to assess the collection efficiency of the company.

3. Number of Days of Payables:
- The Number of Days of Payables ratio reflects how long it takes a company to pay its suppliers.
- Unfortunately, the data does not contain information on Nucor's Days of Payables across the years, making it challenging to evaluate the company's efficiency in managing its payables.

In conclusion, based on the available data, we can see fluctuations in Nucor Corp's Days of Inventory on Hand over the years, indicating varying levels of inventory management efficiency. However, the absence of information on Days of Sales Outstanding and Number of Days of Payables limits our ability to provide a comprehensive assessment of the company's overall activity ratios.

---

Long-term

The fixed asset turnover ratio measures how efficiently a company utilizes its fixed assets to generate sales. The trend in Nucor Corp's fixed asset turnover ratio shows an improvement from 2.92 in 2020 to 4.50 in 2021, indicating that the company is generating more revenue from its fixed assets. However, there was a slight decrease to 4.32 in 2022, which could suggest a potential decrease in the efficiency of utilizing fixed assets to generate sales. The absence of data for 2023 and 2024 makes it challenging to assess the trend accurately for those years.

Total asset turnover ratio reflects how effectively a company utilizes all its assets to generate sales. Nucor Corp's total asset turnover ratio increased from 1.00 in 2020 to 1.41 in 2021, indicating a significant improvement in the utilization of total assets to generate revenue. However, the ratio declined to 1.28 in 2022 and further decreased to 0.98 in 2023 and 0.91 in 2024. The steady decline could suggest a decrease in the company's ability to generate sales relative to its investment in total assets.

Overall, the analysis of Nucor Corp's long-term activity ratios indicates fluctuations in the efficiency of utilizing fixed assets and total assets to generate sales over the years. It is important for the company to closely monitor these ratios and take necessary steps to improve operational efficiency and asset utilization.