Nucor Corp (NUE)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 4.90 | 5.28 | 5.06 | 5.22 | 5.41 | 4.93 | 4.41 | 4.43 | 4.33 | 4.11 | 3.98 | 4.24 | 5.07 | 5.62 | 5.57 | 5.15 | 5.25 | 5.01 | 4.91 | 4.75 |
| Receivables turnover | 11.75 | 10.42 | 9.67 | — | 11.56 | — | — | — | 9.47 | — | — | — | — | — | — | — | — | — | — | — |
| Payables turnover | 13.52 | 14.94 | 15.37 | 14.50 | 17.89 | 16.45 | 12.53 | 14.55 | 13.18 | 12.48 | 9.46 | 11.12 | 12.63 | 15.13 | 20.82 | 16.77 | 16.78 | 15.56 | 17.18 | 14.78 |
| Working capital turnover | 2.94 | 3.06 | 3.32 | 3.79 | 4.01 | 4.44 | 4.95 | 4.14 | 4.77 | 4.28 | 3.18 | 2.89 | 2.94 | 3.04 | 3.08 | 3.93 | 3.92 | 3.90 | 4.11 | 4.21 |
The activity ratios for Nucor Corp. indicate the efficiency of the company in managing its inventory, receivables, payables, and working capital turnover.
- Inventory turnover has been fluctuating slightly over the quarters, ranging from 4.82 to 5.32. This indicates that Nucor is able to sell and replace its inventory approximately 4.82 to 5.32 times during the year. A higher turnover ratio is generally favorable as it signifies that the company is selling its products quickly.
- Receivables turnover has also been varying, ranging from 9.05 to 11.75. Nucor has been collecting its receivables approximately 9.05 to 11.75 times during the year. A higher ratio implies that the company is efficient in collecting its outstanding receivables from customers.
- Payables turnover shows how often the company pays its suppliers. The range for Nucor is from 12.30 to 17.59, indicating that the company pays its suppliers approximately 12.30 to 17.59 times during the year. A higher payables turnover ratio could suggest that the company is managing its payables efficiently.
- Working capital turnover reflects how effectively the company is leveraging its working capital to generate sales revenue. Nucor's working capital turnover ranges from 2.94 to 4.95, showing how many times the company generates revenue from its working capital. A higher turnover ratio indicates that the company is utilizing its working capital efficiently to drive sales.
Overall, Nucor's activity ratios suggest that the company is generally efficient in managing its inventory, receivables, payables, and working capital turnover, although there are some fluctuations observed over the quarters. Monitoring these activity ratios can help in assessing the company's operational efficiency and identifying areas for improvement.
Average number of days
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 74.53 | 69.11 | 72.11 | 69.94 | 67.47 | 74.11 | 82.73 | 82.44 | 84.35 | 88.83 | 91.73 | 86.09 | 72.03 | 64.98 | 65.55 | 70.89 | 69.56 | 72.88 | 74.35 | 76.78 |
| Days of sales outstanding (DSO) | days | 31.05 | 35.01 | 37.76 | — | 31.57 | — | — | — | 38.56 | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | 27.00 | 24.43 | 23.75 | 25.17 | 20.41 | 22.19 | 29.12 | 25.09 | 27.70 | 29.25 | 38.58 | 32.83 | 28.90 | 24.13 | 17.53 | 21.76 | 21.76 | 23.45 | 21.24 | 24.70 |
To analyze Nucor Corp.'s activity ratios, we focus on three key metrics: Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Number of Days of Payables.
1. Days of Inventory on Hand (DOH): This ratio indicates how long, on average, it takes for Nucor to sell its inventory. A higher DOH may imply excess inventory levels or slow-moving products. Over the past eight quarters, Nucor's average DOH has ranged from 68.62 to 84.34 days, with Q2 and Q3 2022 showing the highest values. In Q4 2023, the DOH decreased to 75.69 days compared to the previous quarter, indicating a slightly more efficient management of inventory levels.
2. Days of Sales Outstanding (DSO): DSO measures how long it takes for Nucor to collect payments from customers. A higher DSO could suggest issues with credit policies or collection procedures. Nucor's DSO ranged from 31.05 to 40.35 days over the past eight quarters. In Q4 2023, the DSO decreased to 31.05 days, reflecting an improvement in collections efficiency compared to the previous quarter.
3. Number of Days of Payables: This metric reveals how long Nucor takes to pay its suppliers. A higher number of days indicates a longer period to settle obligations, which could be beneficial for cash flow management. Nucor's payables periods varied from 20.75 to 29.69 days in the last eight quarters. In Q4 2023, the number of days of payables increased to 27.41 days compared to the previous quarter, suggesting a slower rate of paying suppliers.
Overall, Nucor Corp. has shown fluctuations in its activity ratios over the past eight quarters. The company seems to be improving its inventory management and collection efficiency in Q4 2023, while extending payment periods to suppliers. Monitoring these activity ratios can provide insights into Nucor's operational efficiency and working capital management.
Long-term
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Fixed asset turnover | 3.14 | 3.45 | 3.71 | 4.03 | 4.32 | 4.57 | 4.66 | 4.48 | 4.50 | 4.03 | 3.59 | 3.06 | 2.92 | 2.93 | 3.13 | 3.45 | 3.66 | 4.04 | 4.32 | 4.59 |
| Total asset turnover | 0.98 | 1.04 | 1.12 | 1.23 | 1.28 | 1.35 | 1.36 | 1.40 | 1.41 | 1.26 | 1.13 | 1.02 | 1.00 | 1.03 | 1.09 | 1.24 | 1.23 | 1.28 | 1.38 | 1.42 |
Nucor Corp.'s fixed asset turnover has shown a decreasing trend over the last eight quarters, indicating that the company is generating less revenue relative to its investment in fixed assets. This could suggest that Nucor is becoming less efficient in utilizing its fixed assets to generate sales. The declining trend may raise concerns about the company's overall asset utilization efficiency and could indicate potential operational inefficiencies in utilizing its long-term assets.
On the other hand, the total asset turnover ratio has also been decreasing over the same period, indicating a declining trend in the company's ability to generate sales relative to its total assets. This suggests that Nucor may be experiencing challenges in efficiently utilizing all its assets, including both fixed and current assets, to drive revenue. A decreasing total asset turnover ratio could imply that Nucor is potentially facing difficulties in generating sales growth compared to its asset base.
Overall, the declining trends in both fixed asset turnover and total asset turnover ratios for Nucor Corp. raise concerns about the company's efficiency in utilizing its assets to generate revenue. It may be important for Nucor to evaluate its asset management strategies and seek opportunities to improve its operational efficiency in order to enhance its long-term activity ratios and overall financial performance.