Polaris Industries Inc (PII)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 3.28 | 7.70 | 3.50 | 3.80 | 4.52 |
| Receivables turnover | — | — | — | — | — |
| Payables turnover | — | — | — | — | — |
| Working capital turnover | 21.15 | 11.79 | 19.56 | 24.93 | 22.09 |
Based on the provided data for Polaris Industries Inc, we can analyze the activity ratios as follows:
1. Inventory Turnover: Inventory turnover ratio indicates how efficiently the company manages its inventory. A higher ratio suggests that inventory is selling quickly. Polaris Industries Inc's inventory turnover has shown fluctuations over the years, decreasing from 4.52 in 2020 to 3.28 in 2024. In 2023, there was a significant increase in inventory turnover to 7.70, which may indicate better management of inventory that year. However, the downward trend in recent years could suggest lower sales or potential issues with inventory management.
2. Receivables Turnover: Because the receivables turnover data is not provided, we are unable to comment on Polaris Industries Inc's efficiency in collecting accounts receivable.
3. Payables Turnover: Similarly, since payables turnover data is not available, we cannot analyze how quickly the company pays its suppliers.
4. Working Capital Turnover: The working capital turnover ratio measures how efficiently a company is using its working capital to generate sales. Polaris Industries Inc's working capital turnover has been somewhat volatile, ranging from 11.79 in 2023 to 24.93 in 2021. A higher ratio indicates the company is using its working capital effectively to generate revenue. The decrease in the ratio in 2023 may suggest a decline in sales relative to working capital.
In conclusion, Polaris Industries Inc's activity ratios reflect varying levels of efficiency in managing inventory and working capital over the years. Further analysis of receivables and payables turnover ratios would provide a more comprehensive view of the company's overall operational efficiency.
Average number of days
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 111.35 | 47.37 | 104.39 | 95.97 | 80.83 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
Polaris Industries Inc's activity ratios provide insights into how efficiently the company manages its inventory, sales, and payables.
1. Days of Inventory on Hand (DOH):
- Polaris Industries Inc's DOH has varied over the years, ranging from a low of 47.37 days on December 31, 2023, to a high of 111.35 days on December 31, 2024.
- An increasing trend in DOH, as seen from 2020 to 2024, may indicate that the company is taking longer to sell its inventory or facing challenges in managing its inventory levels efficiently.
2. Days of Sales Outstanding (DSO):
- The DSO data for Polaris Industries Inc is not available, possibly implying that the company does not provide credit sales to customers or does not track this metric.
3. Number of Days of Payables:
- Similarly, information on the number of days of payables for Polaris Industries Inc is not provided in the data, making it difficult to assess how quickly the company pays its suppliers.
Overall, a comprehensive analysis of Polaris Industries Inc's activity ratios is limited by the availability of complete data. An analysis of DSO and payables turnover would provide a more holistic view of the company's operational efficiency and cash flow management.
Long-term
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | — | — | 7.60 | 7.19 | 7.91 |
| Total asset turnover | 1.30 | 1.62 | 1.65 | 1.62 | 1.52 |
The fixed asset turnover ratio for Polaris Industries Inc has shown a slight decline from 7.91 in 2020 to 7.19 in 2021 before increasing to 7.60 in 2022. However, there is missing data for 2023 and 2024. This ratio indicates that the company generated $7.60 in sales for every dollar invested in fixed assets in 2022.
In contrast, the total asset turnover ratio has exhibited a more fluctuating trend over the same period. It increased from 1.52 in 2020 to 1.62 in 2021, further rising to 1.65 in 2022, but then dropped to 1.62 in 2023, and notably fell to 1.30 in 2024. This metric suggests that the company generated $1.30 in sales for every dollar of total assets in 2024.
Overall, the fixed asset turnover ratio indicates the efficiency of utilizing fixed assets to generate sales, while the total asset turnover ratio reflects the efficiency of using all assets to generate revenue. The declining trend in total asset turnover from 2022 to 2024 may warrant further investigation into the company's asset management efficiency and sales generation strategies.