Palo Alto Networks Inc (PANW)

Activity ratios

Short-term

Turnover ratios

	Jul 31, 2024	Jul 31, 2023	Jul 31, 2022	Jul 31, 2021	Jul 31, 2020
Inventory turnover	—	14.76	—	—	—
Receivables turnover	2.40	2.40	2.43	3.10	3.19
Payables turnover	48.63	37.84	34.37	62.17	45.54
Working capital turnover	—	—	—	—	1.36

Palo Alto Networks Inc's activity ratios indicate the company's efficiency in managing its resources and operations.

1. Inventory turnover:
- In the most recent year (2023), the inventory turnover ratio was 14.76, indicating that the company sold and replaced its inventory approximately 14.76 times during the year. This suggests efficient management of inventory.

2. Receivables turnover:
- The receivables turnover ratio has been relatively stable over the years, ranging from 2.40 to 3.19. This indicates that on average, the company collected its accounts receivable around 2.40 to 3.19 times a year, reflecting the effectiveness of its credit and collection policies.

3. Payables turnover:
- The payables turnover ratio has shown variability over the years, with values ranging from 34.37 to 62.17. A higher payables turnover ratio indicates that the company is paying its suppliers more frequently, potentially benefiting from discounts or favorable payment terms.

4. Working capital turnover:
- The working capital turnover ratio was not provided for most years, except for 2020 where it was 1.36. This ratio reflects how effectively the company is using its working capital to generate sales revenue. The higher the ratio, the better the utilization of working capital.

Overall, Palo Alto Networks Inc's activity ratios highlight aspects of its operational efficiency, such as inventory management, accounts receivable collection, payables management, and working capital utilization.

Average number of days

		Jul 31, 2024	Jul 31, 2023	Jul 31, 2022	Jul 31, 2021	Jul 31, 2020
Days of inventory on hand (DOH)	days	—	24.73	—	—	—
Days of sales outstanding (DSO)	days	152.07	151.80	150.23	117.82	114.26
Number of days of payables	days	7.51	9.65	10.62	5.87	8.01

Days of inventory on hand (DOH) for Palo Alto Networks Inc has been inconsistently reported over the past five years, with no data available for 2024 and missing data for previous years. However, the company's Days of Sales Outstanding (DSO) have shown a slight increase over the period, indicating that it takes longer for the company to collect its accounts receivable.

On the other hand, the Number of Days of Payables for Palo Alto Networks Inc has fluctuated significantly year over year. The company's payables days have decreased from 8.01 days in 2020 to 7.51 days in 2024, although there was an increase in 2023. This suggests that the company is taking less time to pay its suppliers, which could potentially improve cash flow efficiency.

Overall, while the company's inventory management and collection of accounts receivable show room for improvement, the trend in payables days indicates a more efficient management of liabilities which could positively impact the company's working capital position.

Long-term

	Jul 31, 2024	Jul 31, 2023	Jul 31, 2022	Jul 31, 2021	Jul 31, 2020
Fixed asset turnover	22.23	19.34	15.30	12.84	9.52
Total asset turnover	0.40	0.47	0.45	0.40	0.37

The long-term activity ratios of Palo Alto Networks Inc show a positive trend over the past five years. The fixed asset turnover has been consistently increasing from 9.52 in 2020 to 22.23 in 2024. This indicates that the company is generating more revenue relative to its investment in fixed assets, reflecting an improvement in efficiency in utilizing its long-term assets.

Similarly, the total asset turnover has also shown an upward trend, rising from 0.37 in 2020 to 0.4 in 2024. This indicates that the company is generating more revenue relative to its total assets, which is a positive sign of efficiency and effective management of its assets.

Overall, the trend in both fixed asset turnover and total asset turnover ratios suggests that Palo Alto Networks Inc has been able to improve its operational performance and asset management efficiency over the years.