Shenandoah Telecommunications Co (SHEN)

Fixed asset turnover

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Revenue (ttm)	US$ in thousands	300,501	301,022	297,724	292,123	285,771	273,763	264,883	257,462	249,739	245,267	241,096	344,678	431,664	534,529	624,303	609,113	611,175	611,662	613,833	761,706
Property, plant and equipment	US$ in thousands	879,499	822,494	786,446	739,587	687,553	641,407	609,785	581,541	554,162	525,799	495,599	468,383	440,427	413,602	703,012	695,920	363,087	688,516	695,725	701,980
Fixed asset turnover		0.34	0.37	0.38	0.39	0.42	0.43	0.43	0.44	0.45	0.47	0.49	0.74	0.98	1.29	0.89	0.88	1.68	0.89	0.88	1.09

December 31, 2023 calculation

Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $300,501K ÷ $879,499K
= 0.34

The fixed asset turnover ratio measures the effectiveness of a company in generating revenue relative to its investment in fixed assets. A higher ratio indicates that the company is more efficient in utilizing its fixed assets to generate sales.

Looking at the trend for Shenandoah Telecommunications Co., we observe a declining pattern in the fixed asset turnover ratio over the quarters. The ratio has shown a consistent decrease from 0.43 in Q1 2022 to 0.33 in Q4 2023.

A decreasing fixed asset turnover ratio could indicate that the company is becoming less efficient in generating sales from its fixed asset base. This may raise concerns about the company's asset utilization and operational efficiency.

It is advisable for stakeholders and management of Shenandoah Telecommunications Co. to assess the reasons behind this trend in the fixed asset turnover ratio. They should investigate whether there have been changes in the company's fixed asset base, operational processes, or sales performance that may have contributed to the declining ratio. Addressing any inefficiencies or underutilization of fixed assets can help improve the company's overall financial performance and profitability in the long run.