Olin Corporation (OLN)

Short-term

Turnover ratios

The inventory turnover of Olin Corporation has remained relatively stable over the past five years, ranging from 6.79 to 7.97. This indicates that the company is efficient in managing its inventory levels and converting them into sales. A decrease in the inventory turnover ratio may suggest possible overstocking or slowing sales.

The receivables turnover and payables turnover ratios are not available for analysis for any of the years provided. The absence of this data limits our ability to assess the efficiency of Olin Corporation in collecting receivables from customers and managing payments to suppliers.

On the other hand, the working capital turnover ratio for Olin Corporation has shown a consistent trend of around 14 to 16 over the same period. This implies that the company's working capital is efficiently utilized to generate sales. A higher working capital turnover ratio indicates that the company is effectively using its resources to drive revenue.

Overall, based on the available activity ratios, Olin Corporation appears to be managing its inventory efficiently and utilizing its working capital effectively to support its operations. However, more information on receivables and payables turnover would provide a more comprehensive view of the company's overall financial health and efficiency.

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Average number of days

Olin Corporation's activity ratios show the efficiency with which the company manages its working capital.

- Days of Inventory on Hand (DOH) measures how many days it takes for the company to sell its inventory. The DOH increased from 45.82 days in 2020 to 51.80 days in 2024, indicating a lengthening of the time it takes to turn inventory into sales. This could potentially tie up more capital in inventory and could be a sign of inefficiency in managing inventory levels.

- Days of Sales Outstanding (DSO) represents the average number of days it takes for the company to collect revenue after a sale. However, data for DSO is not available, which limits the analysis of Olin Corporation's ability to collect cash from customers.

- Number of Days of Payables indicates how long the company takes to pay its suppliers. Like DSO, data for this ratio is also unavailable. However, a longer period of payables could potentially suggest a favorable situation for the company as it can utilize funds more effectively.

Overall, the increase in DOH suggests potential issues related to inventory management that Olin Corporation may need to address to improve its efficiency and working capital performance. Having data for DSO and the number of days of payables would provide a more comprehensive view of the company's working capital management.

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Long-term

The Fixed Asset Turnover ratio measures how effectively a company is utilizing its fixed assets to generate sales. In the case of Olin Corporation, the Fixed Asset Turnover ratio has been improving over the years, indicating that the company is becoming more efficient in generating sales from its fixed assets.

The trend shows a steady increase from 1.82 in 2020 to 3.09 in 2022. This indicates that Olin Corporation was able to generate $3.09 in sales for every $1 invested in fixed assets by the end of 2022. However, there is missing data for 2023 and 2024, which makes it difficult to assess the trend for these years.

On the other hand, the Total Asset Turnover ratio measures how effectively a company is using its total assets to generate sales. Olin Corporation's Total Asset Turnover ratio also shows a positive trend, increasing from 0.70 in 2020 to 1.17 in 2022, before decreasing slightly to 0.86 by the end of 2024.

Overall, the improvement in both Fixed Asset Turnover and Total Asset Turnover ratios suggests that Olin Corporation has been able to optimize the use of its assets to drive sales, which is a positive sign of operational efficiency. To better understand the dynamics behind the fluctuations in the ratios, additional data for 2023 and 2024 would be necessary.