Revvity Inc. (RVTY)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 3.47 | 3.26 | 3.27 | 3.25 | 4.17 |
| Receivables turnover | 4.35 | 5.40 | 3.74 | 3.27 | 3.98 |
| Payables turnover | 7.27 | 4.85 | 4.29 | 5.11 | 6.31 |
| Working capital turnover | 1.77 | 1.90 | 3.12 | 6.45 | 4.72 |
Revvity Inc.'s activity ratios provide insight into how efficiently the company is managing its assets and liabilities to generate sales and working capital.
1. Inventory turnover has shown a declining trend over the past five years, indicating that the company is taking longer to sell its inventory. This could be due to overstocking or slow-moving products, which may tie up capital and lead to potential inventory obsolescence.
2. Receivables turnover has fluctuated over the years but generally remains at a moderate level. A higher receivables turnover ratio suggests that the company is efficiently collecting payments from customers, converting credit sales into cash quickly. The slight variations may be attributed to changes in credit policies or customer payment behavior.
3. Payables turnover has exhibited some variability over the years, with a peak in 2022. A lower payables turnover ratio indicates that the company is taking longer to pay its suppliers, potentially signaling issues with cash flow management or strained relationships with vendors.
4. Working capital turnover has shown a decreasing trend over the years, indicating that the company is generating less revenue per unit of working capital invested. A lower ratio may suggest inefficiencies in utilizing working capital to generate sales or could be a result of changes in the company's operating cycle.
Overall, Revvity Inc. should closely monitor and analyze its activity ratios to identify areas for improvement in inventory management, receivables collection, payables management, and working capital efficiency. By addressing these areas, the company can optimize its asset utilization and enhance overall operational performance.
Average number of days
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 105.32 | 111.95 | 111.53 | 112.27 | 87.58 |
| Days of sales outstanding (DSO) | days | 83.97 | 67.54 | 97.62 | 111.46 | 91.79 |
| Number of days of payables | days | 50.22 | 75.33 | 85.06 | 71.42 | 57.87 |
Revvity Inc.'s activity ratios provide insights into the efficiency of its management of inventory, receivables, and payables over the past five years.
1. Days of Inventory on Hand (DOH): This ratio reveals the number of days it takes for Revvity Inc. to sell its inventory. The trend shows an increasing trend from 87.58 days in 2019 to 129.03 days in 2023, indicating that the company is taking longer to sell its inventory. This could be a sign of overstocking or slow-moving inventory.
2. Days of Sales Outstanding (DSO): DSO measures how quickly Revvity Inc. collects payment from its customers. The trend shows fluctuations over the years, ranging from 67.54 days in 2023 to 111.46 days in 2021. A lower DSO is preferred as it indicates faster collection of receivables, suggesting efficient credit policies and strong customer relationships.
3. Number of Days of Payables: This ratio represents the average number of days it takes for Revvity Inc. to pay its suppliers. The trend indicates fluctuations, with the number of days ranging from 57.87 in 2019 to 75.33 in 2023. A higher number of days indicates that the company is taking longer to pay its suppliers, which can have implications on supplier relationships and potential cash flow advantages.
In summary, Revvity Inc. should focus on optimizing its inventory management practices to reduce the DOH, aim for faster collection of receivables to lower DSO, and carefully manage payables to maintain healthy supplier relationships and cash flow management.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 5.40 | 6.86 | 7.88 | 10.27 | 9.06 |
| Total asset turnover | 0.20 | 0.23 | 0.26 | 0.48 | 0.44 |
Revvity Inc.'s long-term activity ratios indicate the company's efficiency in using fixed assets and total assets to generate revenue over the past five years. The fixed asset turnover ratio has shown a declining trend from 9.06 in 2019 to 5.40 in 2023. This suggests that the company is generating less revenue per dollar of fixed assets invested, which may indicate underutilization or inefficiency in managing its fixed assets.
Similarly, the total asset turnover ratio has also decreased over the same period, from 0.44 in 2019 to 0.20 in 2023. This decline indicates that the company is generating less revenue per dollar of total assets, which could be a sign of decreasing sales or inefficient asset utilization.
Overall, Revvity Inc.'s long-term activity ratios suggest a declining trend in asset efficiency over the past five years, which could indicate potential operational challenges that may require further investigation and management attention.