Arcus Biosciences Inc (RCUS)

Short-term

Turnover ratios

Based on the provided data, we can analyze the activity ratios of Arcus Biosciences Inc over the past five years:

1. Receivables Turnover:
Receivables turnover indicates how efficiently a company is collecting its accounts receivable during a specific period. Arcus Biosciences Inc's receivables turnover has fluctuated significantly over the years, with a sharp decline from 113.64 in 2019 to 0.51 in 2021, before showing a slight recovery in 2022 and 2023. The lower ratio in 2021 suggests that the company took longer to collect its receivables, possibly due to changes in sales terms or credit policies. However, the improvement in 2022 and 2023 could indicate better management of accounts receivable.

2. Payables Turnover:
The payables turnover ratio reflects how quickly a company pays its suppliers. The data provided shows a payables turnover of 0.00 consistently across all years. A payables turnover of zero may suggest that Arcus Biosciences Inc pays its suppliers infrequently or may have negotiated longer payment terms, indicating a potentially advantageous position with its suppliers.

3. Working Capital Turnover:
The working capital turnover ratio measures how effectively a company utilizes its working capital to generate sales. Arcus Biosciences Inc's working capital turnover has shown fluctuations over the years, with an increase from 0.09 in 2019 to 0.18 in 2023. A higher ratio indicates that the company is generating more sales relative to its working capital, which can be a positive sign of operational efficiency and productivity.

In conclusion, while the receivables turnover and working capital turnover ratios have shown variations over the years, the consistent zero value for the payables turnover ratio raises questions about Arcus Biosciences Inc's payment practices with suppliers. Further analysis and context would be needed to fully understand the implications of these activity ratios on the company's financial performance and operational effectiveness.

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Average number of days

Days of Inventory on Hand (DOH) for Arcus Biosciences Inc is not provided in the table, which indicates that the company's inventory turnover rate is not available for analysis.

Days of Sales Outstanding (DSO) for Arcus Biosciences Inc shows a significant fluctuation over the years. In 2019, the DSO was at a low of 3.21 days, which suggests that the company was efficient in collecting its accounts receivable. However, in 2021, the DSO spiked to 711.94 days, indicating a major delay in collecting payments from customers. This significant increase in DSO may raise concerns about the company's credit policies and the effectiveness of its collections process. It is important for Arcus Biosciences to focus on improving its accounts receivable management to reduce the collection period and enhance cash flow.

The Number of Days of Payables for Arcus Biosciences Inc is not provided in the table, which makes it difficult to assess the company's payment practices to suppliers and its liquidity management.

In conclusion, while the Days of Sales Outstanding ratio reveals varying trends in Arcus Biosciences Inc's accounts receivable efficiency over the years, the absence of data for Days of Inventory on Hand and Number of Days of Payables limits a comprehensive analysis of the company's activity ratios.

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Long-term

The long-term activity ratios for Arcus Biosciences Inc provide insight into how effectively the company is utilizing its long-term assets to generate revenue.

Fixed asset turnover, which measures the efficiency of the company in generating revenue from its fixed assets, has shown a declining trend over the past five years. In 2023, the fixed asset turnover ratio stands at 2.29, indicating that for every dollar invested in fixed assets, the company generated $2.29 in revenue. This ratio has decreased from the peak of 11.80 in 2021 to its current level, suggesting a potential decrease in the productivity of the company's fixed assets over time.

On the other hand, the total asset turnover ratio, which measures the overall efficiency of the company in generating revenue from all its assets, has also fluctuated over the same period. The ratio in 2023 is 0.11, showing that for every dollar of total assets, the company generated $0.11 in revenue. This indicates a slight improvement from the ratios in 2020 and 2021 but is still relatively low compared to other years.

Overall, the decreasing trend in fixed asset turnover and the fluctuating pattern in total asset turnover suggest that Arcus Biosciences Inc may need to further analyze its long-term asset management strategies to enhance efficiency in generating revenue from its asset base. Further investigation into the company's operational effectiveness and investment decisions may be warranted to improve these long-term activity ratios.