Pacira BioSciences, Inc. (PCRX)

Short-term

Turnover ratios

The activity ratios of Pacira BioSciences, Inc. provide insights into how efficiently the company manages its assets and liabilities to generate sales.

1. Inventory Turnover: This ratio measures how many times the company's inventory is sold and replaced during a specific period. In the years provided, Pacira BioSciences' inventory turnover fluctuated, ranging from a low of 1.36 in December 31, 2024, to a high of 2.07 in December 31, 2022. Generally, a higher turnover indicates efficient inventory management.

2. Receivables Turnover: The receivables turnover ratio indicates how efficiently the company collects cash from its credit sales. The data shows that no specific figures were available for this ratio in the years provided, so it's challenging to assess the effectiveness of Pacira BioSciences' credit management practices.

3. Payables Turnover: This ratio reflects how quickly a company pays its suppliers. Similar to receivables turnover, there is no specific data available for this ratio for the years provided, making it difficult to evaluate Pacira BioSciences' payment terms with suppliers.

4. Working Capital Turnover: The working capital turnover ratio measures how efficiently the company generates sales relative to its working capital. Pacira BioSciences demonstrated consistent improvements in this ratio over the years, with a peak of 1.90 in December 31, 2022. A higher turnover implies better utilization of working capital to drive sales growth.

In summary, while Pacira BioSciences has shown variability in inventory turnover and improvement in working capital turnover, the lack of data for receivables and payables turnover ratios limits a comprehensive assessment of the company's overall efficiency in managing its assets and liabilities to drive sales. Monitoring these ratios over time can help identify trends and areas for further operational improvements.

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Average number of days

Based on the provided data for Pacira BioSciences, Inc., we can analyze the activity ratios as follows:

1. Days of Inventory on Hand (DOH):
- The Days of Inventory on Hand ratio indicates the number of days a company takes to sell its average inventory during a specific period. It measures how efficiently the company manages its inventory.
- Pacira BioSciences had 201.12 days of inventory on hand as of December 31, 2020, which increased to 256.47 days by December 31, 2021. Subsequently, it decreased to 175.94 days by December 31, 2022, but then increased to 206.25 days by December 31, 2023, and further to 268.31 days by December 31, 2024.
- The increase in the DOH ratio indicates that the company may be facing challenges in managing its inventory efficiently, possibly leading to excess inventory levels and tying up capital.

2. Days of Sales Outstanding (DSO):
- Unfortunately, there is no data available for the Days of Sales Outstanding ratio. DSO measures the average number of days it takes for a company to collect payment after a sale, reflecting the efficiency of the company's accounts receivable management.

3. Number of Days of Payables:
- Similarly, there is no data provided for the Number of Days of Payables ratio. This ratio measures how long a company takes to pay its suppliers and is essential for assessing the company's payment practices and liquidity position.

Overall, based on the DOH trend, Pacira BioSciences may want to focus on improving its inventory management to avoid potential issues like overstocking and tying up excess capital. However, without data for DSO and the number of days of payables, a comprehensive assessment of the company's overall operating efficiency is challenging. Further analysis incorporating these ratios would provide a more holistic view of Pacira BioSciences' activity performance.

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Long-term

The fixed asset turnover ratio measures how efficiently a company is generating revenue from its investments in fixed assets. A higher ratio indicates better utilization of fixed assets to generate sales.

For Pacira BioSciences, Inc., the fixed asset turnover has shown some variability over the years. In 2020, the ratio was 3.08, indicating that the company generated $3.08 in revenue for every $1 invested in fixed assets. However, this ratio decreased to 2.04 in 2021, suggesting a decline in efficiency in utilizing fixed assets for revenue generation. It then improved to 2.62 in 2022, showing a partial recovery.

Looking at the total asset turnover ratio, which measures how well a company is utilizing all its assets to generate sales, Pacira BioSciences, Inc. has shown a declining trend. In 2020, the ratio was 0.33, meaning that the company generated $0.33 in revenue for every $1 of total assets. This ratio decreased to 0.26 in 2021, indicating a decrease in efficiency in asset utilization. However, the ratio showed some improvement in subsequent years, reaching 0.45 by the end of 2024.

Overall, Pacira BioSciences, Inc. should continue to monitor and strive to improve its efficiency in generating revenue from both fixed and total assets to enhance its overall operational performance and profitability.