Sylvamo Corp (SLVM)

Short-term

Turnover ratios

Sylvamo Corp's inventory turnover has been stable, fluctuating between 5.25 and 7.20 over the last five quarters. This indicates that the company is efficiently managing its inventory levels and turning over its inventory multiple times within each period.

The receivables turnover ratio has also been fairly consistent, ranging from 8.06 to 8.69. This suggests that Sylvamo Corp is effective in collecting money owed by customers and converting receivables into cash in a timely manner.

On the other hand, the payables turnover ratio has been slightly more variable, with a range of 5.78 to 7.32. This could imply that the company's payment terms with suppliers may have been changing, influencing how quickly it is settling its payables.

The working capital turnover ratio has shown a relatively stable trend, varying between 6.93 and 7.47. This metric reflects how well Sylvamo Corp is utilizing its working capital to generate sales revenue. Consistent or increasing ratios indicate effective management of working capital.

Overall, from an activity ratio perspective, Sylvamo Corp appears to be managing its inventory, receivables, payables, and working capital efficiently, which is crucial for ensuring smooth operations and optimal utilization of resources.

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Average number of days

Analyzing Sylvamo Corp's activity ratios, we first look at the Days of Inventory on Hand (DOH) which measures how many days it takes the company to sell its inventory. The trend shows a slight increase in DOH over the past five quarters, from 50.73 days in Q4 2022 to 52.50 days in Q4 2023. This could indicate that Sylvamo is taking slightly longer to turn its inventory into sales.

Next, looking at the Days of Sales Outstanding (DSO), we see a decrease in the number of days it takes Sylvamo to collect its accounts receivable from 45.27 days in Q4 2022 to 41.98 days in Q4 2023. This is a positive trend as it suggests the company is collecting its receivables more efficiently.

The Number of Days of Payables shows the number of days it takes Sylvamo to pay its suppliers. The trend in payables days is fluctuating but relatively stable, ranging from 49.89 days in Q3 2023 to 63.13 days in Q4 2022. This indicates that Sylvamo manages its payables reasonably well.

In conclusion, Sylvamo Corp has some room for improvement in managing its inventory turnover, but it has shown efficiency in collecting receivables. Payables management appears relatively stable. Evaluating these activity ratios collectively provides insights into Sylvamo's efficiency in managing its working capital and operational cycles.

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Long-term

The long-term activity ratios of Sylvamo Corp indicate the efficiency with which the company utilizes its assets to generate sales. The fixed asset turnover ratio has been relatively consistent over the quarters, ranging from 2.72 to 3.19, suggesting that the company is generating sales efficiently from its fixed assets. However, a decreasing trend in this ratio could indicate potential inefficiencies in utilizing fixed assets.

In contrast, the total asset turnover ratio has been fluctuating between 1.27 to 1.34, with a slight decreasing trend. This ratio indicates the company's ability to generate sales from all of its assets. A declining total asset turnover ratio may suggest that the company is less efficient in utilizing all of its assets to generate sales.

Overall, while the fixed asset turnover ratios are relatively stable and at reasonable levels, the decreasing trend in the total asset turnover ratio warrants further investigation into the company's asset management and sales generation strategies to ensure optimal efficiency in utilizing its assets.