News Corp B (NWS)

Short-term

Turnover ratios

The activity ratios of News Corp B provide insights into the efficiency of the company's operations in managing its inventory, receivables, payables, and working capital over the past five years.

1. Inventory Turnover:
- The inventory turnover ratio shows how many times a company's inventory is sold and replaced over a period. News Corp B's inventory turnover has remained relatively stable over the years, ranging from 13.50 to 16.21. This indicates that the company is effectively managing its inventory levels and turning its inventory into sales efficiently.

2. Receivables Turnover:
- The receivables turnover ratio measures how many times a company collects its accounts receivable during a period. News Corp B's receivables turnover has fluctuated slightly but has been relatively consistent, ranging from 6.25 to 7.49. This implies that the company is efficient in collecting payments from its customers.

3. Payables Turnover:
- The payables turnover ratio indicates how quickly a company pays its suppliers. News Corp B's payables turnover has shown some variability, ranging from 9.54 to 15.58. A higher payables turnover ratio suggests that the company is effectively managing its payment cycles with suppliers.

4. Working Capital Turnover:
- The working capital turnover ratio measures how efficiently a company utilizes its working capital to generate sales. News Corp B's working capital turnover has varied significantly over the years, from 7.66 to 18.09. A higher working capital turnover ratio indicates that the company is using its working capital efficiently to support sales growth.

Overall, News Corp B's activity ratios reflect a relatively efficient management of inventory, receivables, payables, and working capital, which is essential for maintaining healthy operational performance and liquidity.

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Average number of days

To analyze the activity ratios of News Corp B, we will focus on the days of inventory on hand (DOH), days of sales outstanding (DSO), and number of days of payables:

1. Days of Inventory on Hand (DOH):
- The trend in DOH from 2020 to 2024 indicates a slight increase in the number of days it takes for News Corp B to turn its inventory into sales.
- In 2024, it took the company approximately 24.75 days to sell its inventory, compared to 23.23 days in 2020.
- This upward trend may suggest that News Corp B may be facing challenges in efficiently managing its inventory or may have excess inventory on hand.

2. Days of Sales Outstanding (DSO):
- The DSO ratio reflects the average number of days it takes for News Corp B to collect its accounts receivable.
- There has been some fluctuation in DSO over the years, with a peak in 2021 at 58.43 days and a decrease to 54.40 days in 2024.
- A lower DSO indicates that the company is collecting its receivables more quickly, which is generally a positive sign as it improves cash flow and liquidity.

3. Number of Days of Payables:
- This ratio shows the average number of days it takes for News Corp B to pay its suppliers.
- The number of days of payables has fluctuated over the years, with a significant decrease from 38.25 days in 2023 to 26.26 days in 2024.
- A lower number of days of payables may suggest that the company is paying its suppliers more quickly, which could impact liquidity and relationships with suppliers.

In summary, News Corp B should closely monitor its activity ratios to ensure effective management of inventory, receivables, and payables. The company should aim to strike a balance between these ratios to optimize working capital and maintain healthy cash flow.

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Long-term

The analysis of News Corp B's long-term activity ratios reveals a positive trend in both fixed asset turnover and total asset turnover over the past five years.

Fixed asset turnover, which measures how efficiently the company generates sales from its fixed assets, has shown a consistent improvement from 3.99 in 2020 to 5.27 in 2024. This indicates that News Corp B has been able to generate more revenue from its fixed assets over time, reflecting efficient utilization and management of its long-term assets.

Total asset turnover, which indicates how effectively the company generates sales from all its assets, also demonstrates a favorable trend, increasing from 0.56 in 2021 to 0.60 in 2024. This suggests that News Corp B has been able to generate more sales relative to its total asset base, reflecting improved overall efficiency in utilizing its assets to generate revenue.

Overall, the increasing trend in both fixed asset turnover and total asset turnover ratios signifies that News Corp B has been effectively utilizing its long-term assets to generate revenue, indicating a positive operational performance in the long run.