Pitney Bowes Inc (PBI)

Short-term

Turnover ratios

The activity ratios of Pitney Bowes, Inc. provide insights into how effectively the company is managing its resources and generating sales.

1. Inventory turnover:
- Pitney Bowes has shown a consistent improvement in inventory turnover over the past five years, with higher ratios indicating that the company is selling its inventory more efficiently.
- The increasing trend from 2019 to 2021 suggests that the company has been managing its inventory well, although there was a slight decline in 2022 and 2023.
- A high inventory turnover generally indicates effective inventory management and timely sales.

2. Receivables turnover:
- The receivables turnover ratio measures how efficiently a company is collecting payments from its customers.
- Pitney Bowes has maintained relatively stable receivables turnover ratios over the past five years, with higher ratios indicating quicker collection of receivables.
- The ratios suggest that the company is consistent in collecting payments from its customers in a timely manner.

3. Payables turnover:
- The payables turnover ratio measures how quickly a company pays its suppliers.
- Pitney Bowes has shown a consistent trend of increasing payables turnover ratios over the past five years, indicating that the company is taking longer to pay its suppliers.
- This could indicate that the company is managing its payables effectively, leveraging credit terms to its advantage.

4. Working capital turnover:
- Working capital turnover reflects how efficiently a company is using its working capital to generate sales.
- Pitney Bowes experienced a significant increase in working capital turnover from 2019 to 2021, indicating improved efficiency in utilizing working capital to drive sales.
- The lack of data for 2020 and a notable decline in 2022 and 2023 suggest fluctuations in the company's working capital management efficiency over the years.

In conclusion, Pitney Bowes has generally displayed effective management of its inventory, receivables, payables, and working capital turnover. The company's ability to maintain or improve these activity ratios demonstrates its effectiveness in utilizing resources and generating sales.

---

Average number of days

Pitney Bowes, Inc.'s activity ratios, including Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Number of Days of Payables, provide insights into the efficiency of the company's inventory management, collection of receivables, and payment of its liabilities.

1. Days of Inventory on Hand (DOH):
- The trend in DOH over the past five years indicates that Pitney Bowes has been able to lower the number of days inventory is held on average. This suggests that the company is managing its inventory levels more efficiently over time.
- The decrease in DOH from 13.27 days in 2019 to 11.72 days in 2023 reflects improved inventory turnover, potentially resulting from better demand forecasting or supply chain management.

2. Days of Sales Outstanding (DSO):
- The trend in DSO shows fluctuations over the years, with varying collection periods for accounts receivable.
- The increase in DSO from 93.73 days in 2022 to 101.22 days in 2023 may indicate delays in collecting receivables, which could impact cash flow and liquidity.

3. Number of Days of Payables:
- The consistency in the number of days of payables indicates that Pitney Bowes has been maintaining stable payment terms with its suppliers.
- The gradual decrease in the number of days of payables from 54.85 days in 2019 to 47.26 days in 2023 suggests that the company may be accelerating its payment cycles, potentially to take advantage of discounts or strengthen supplier relationships.

Overall, while Pitney Bowes has improved its inventory management efficiency and maintained stable payables, there may be opportunities to enhance the collection of receivables to optimize working capital management. Monitoring these activity ratios can provide valuable insights into the company's operational performance and financial health.

---

Long-term

The fixed asset turnover ratio for Pitney Bowes, Inc. has remained relatively stable over the past five years, ranging between 7.68 and 8.27. This indicates that the company generates a consistent level of sales in relation to its fixed assets, reflecting efficient utilization of these assets to generate revenue.

On the other hand, the total asset turnover ratio has shown a gradually increasing trend from 0.59 in 2019 to 0.76 in 2023. This signifies that Pitney Bowes has been more effective in generating sales relative to its total assets over the years, which could indicate improved efficiency in asset utilization and potentially better operational performance.

Overall, the long-term activity ratios suggest that Pitney Bowes has maintained a strong ability to generate revenue in relation to both its fixed assets and total assets, indicating efficient management of its asset base to drive business operations and overall financial performance.