Shenandoah Telecommunications Co (SHEN)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 28.35 | 9.18 | — | 0.16 | 23.48 |
| Receivables turnover | 12.15 | 5.67 | 4.86 | 3.27 | 8.29 |
| Payables turnover | 5.21 | 4.22 | 6.79 | 8.89 | 3.34 |
| Working capital turnover | 3.83 | 8.89 | 2.56 | 1.16 | 6.94 |
Inventory turnover was not provided for all years, but the data shows that Shenandoah Telecommunications Co. effectively managed its inventory in 2019 with a turnover of 46.21 times.
Receivables turnover for the company improved over the years, indicating a better efficiency in collecting receivables. It increased from 8.58 times in 2019 to 11.74 times in 2023, reflecting faster collection of outstanding receivables.
Payables turnover decreased over the years, suggesting a decrease in the speed at which the company paid its suppliers. This decline could be due to changes in payment terms or increased reliance on supplier credit.
Working capital turnover measures how effectively a company utilizes its working capital to generate sales. Shenandoah Telecommunications Co.'s working capital turnover fluctuated over the years, indicating varying efficiency in utilizing its working capital to generate revenues.
Overall, analyzing these activity ratios provides insight into the company's operational efficiency in managing inventory, collecting receivables, paying suppliers, and utilizing working capital in generating sales.
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 | 12.87 | 39.76 | — | 2,226.43 | 15.54 |
| Days of sales outstanding (DSO) | days | 30.04 | 64.33 | 75.08 | 111.77 | 44.00 |
| Number of days of payables | days | 70.09 | 86.43 | 53.79 | 41.05 | 109.34 |
Shenandoah Telecommunications Co.'s activity ratios provide insights into how efficiently the company manages its inventory, accounts receivable, and accounts payable.
1. Days of Inventory on Hand (DOH): The DOH ratio for Shenandoah Telecommunications Co. was not available for the years 2023-2020, indicating insufficient data or limited inventory information. However, in 2019, the company held inventory for an average of 7.90 days before selling it. A lower DOH implies faster turnover of inventory, which can lead to lower storage costs and reduced risk of inventory obsolescence.
2. Days of Sales Outstanding (DSO): The DSO ratio measures how long it takes for the company to collect payments from its customers. Shenandoah Telecommunications Co. has shown fluctuations in its DSO over the years, with a significant decrease in 2023 to 31.08 days from 68.76 days in 2022. A lower DSO generally indicates a more efficient accounts receivable management process, leading to quicker cash conversion.
3. Number of Days of Payables: The number of days of payables ratio reflects how long the company takes to pay its suppliers and vendors. Shenandoah Telecommunications Co. has steadily increased its days of payables over the years, reaching 184.20 days in 2023 from 55.57 days in 2019. A higher number of days of payables suggests that the company is taking longer to settle its payables, potentially improving its cash flow by extending payment terms.
Overall, analysing these activity ratios can provide valuable insights into Shenandoah Telecommunications Co.'s operational efficiency and working capital management.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 0.34 | 0.42 | 0.46 | 0.52 | 1.69 |
| Total asset turnover | 0.24 | 0.29 | 0.28 | 0.11 | 0.32 |
The fixed asset turnover ratio for Shenandoah Telecommunications Co. has been decreasing over the past five years, from 0.91 in 2019 to 0.33 in 2023. This indicates that the company is generating less revenue from its fixed assets in recent years.
On the other hand, the total asset turnover ratio has also seen a declining trend, dropping from 0.34 in 2019 to 0.24 in 2023. This suggests that the company's overall efficiency in generating sales from its total assets has weakened over time.
A lower fixed asset turnover ratio can point towards underutilization or obsolescence of fixed assets, while a decreasing total asset turnover ratio may indicate a decline in the company's overall efficiency in utilizing all assets to generate revenue. These trends suggest a potential need for Shenandoah Telecommunications Co. to review and optimize its asset utilization strategies to improve its long-term activity ratios and overall financial performance.