Ormat Technologies Inc (ORA)

Short-term

Turnover ratios

Based on the provided data for Ormat Technologies Inc's activity ratios:

1. Inventory Turnover:
- The inventory turnover ratio measures how efficiently a company manages its inventory. Ormat Technologies Inc's inventory turnover has shown fluctuations over the years, ranging from 12.15 in 2020 to 20.38 in 2022. A higher inventory turnover ratio indicates that the company is selling its products more quickly, which can be a positive sign for operational efficiency.

2. Receivables Turnover:
- There is no data available for Ormat Technologies Inc's receivables turnover, which indicates that the company may not have significant accounts receivable or may not be tracking this ratio consistently. Receivables turnover measures how efficiently a company collects payments from its customers.

3. Payables Turnover:
- Similar to receivables turnover, there is no data available for Ormat Technologies Inc's payables turnover. Payables turnover ratio reflects how quickly a company pays its suppliers.

4. Working Capital Turnover:
- The working capital turnover ratio shows how efficiently a company is utilizing its working capital to generate sales revenue. Ormat Technologies Inc's working capital turnover has varied, with a significant increase from 2020 to 2021, reaching 11.48, before stabilizing around the 6-8 range in the subsequent years. A higher working capital turnover ratio generally indicates a more efficient use of resources.

Overall, based on the available data, Ormat Technologies Inc has demonstrated varying levels of efficiency in managing its inventory and working capital, but further information on receivables and payables turnover would provide a more complete picture of the company's liquidity management and operational effectiveness.

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Average number of days

Based on the provided data, the analysis of Ormat Technologies Inc's activity ratios reveals the following:

1. Days of Inventory on Hand (DOH):
- The trend in DOH shows a fluctuating pattern over the years, ranging from 17.91 days to 30.05 days.
- A decreasing trend from 2022 to 2024 indicates a more efficient management of inventory, as the company takes fewer days to sell its inventory.
- However, the sudden increase in DOH in 2023 might suggest a potential issue with inventory management efficiency during that year.
- Overall, the decreasing trend in recent years is a positive sign of improved inventory turnover efficiency.

2. Days of Sales Outstanding (DSO):
- The data provided does not include information on DSO, which measures how long it takes for the company to collect revenue from its sales.
- The absence of DSO data makes it challenging to assess the efficiency of Ormat Technologies Inc's accounts receivable management.

3. Number of Days of Payables:
- Similar to DSO, there is no data available for the number of days of payables, which reflects how quickly a company pays its suppliers for goods or services received.
- Without this information, it is difficult to evaluate the company's efficiency in managing its accounts payable.

In conclusion, while the decreasing trend in Days of Inventory on Hand is a positive indication of improved inventory management efficiency, the lack of data on Days of Sales Outstanding and Number of Days of Payables limits a comprehensive analysis of Ormat Technologies Inc's overall activity ratios.

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Long-term

Based on the provided data, Ormat Technologies Inc's long-term activity ratios show a considerable decrease in both Fixed Asset Turnover and Total Asset Turnover from December 31, 2020, to December 31, 2021.

The Fixed Asset Turnover ratio measures the efficiency with which the company generates sales from its fixed assets. Ormat's Fixed Asset Turnover decreased significantly from 1.47 in 2020 to 0.22 in 2021, indicating a decline in the company's ability to generate revenue from its fixed assets efficiently.

Similarly, Total Asset Turnover ratio reflects how well the company utilizes its total assets to generate sales. Ormat's Total Asset Turnover also decreased, albeit less dramatically, from 0.18 in 2020 to 0.15 in 2021. This decline suggests a decrease in the company's overall efficiency in generating revenue from its total assets.

The relatively low ratios in 2021 for both Fixed Asset Turnover and Total Asset Turnover indicate that Ormat Technologies Inc may not be effectively utilizing its assets to generate sales compared to the prior year. Further analysis and investigation would be needed to determine the reasons behind these declines and to assess the company's long-term asset management strategies.