Synnex Corporation (SNX)

Short-term

Turnover ratios

The activity ratios of TD Synnex Corp provide insights into the efficiency of the company's operations and its ability to manage working capital.

Firstly, the inventory turnover has shown some volatility over the past five years. It increased from 2019 to 2020, then decreased in 2021 before picking up again in 2022 and 2023. Overall, the trend indicates an efficient management of inventory, with a notable peak in 2020.

Secondly, the receivables turnover has also exhibited a fluctuating pattern. It increased in 2021, decreased in 2022, and declined further in 2023. This suggests that the company has been collecting its receivables at a slightly slower rate in recent years.

Thirdly, the payables turnover indicates a similar trend to the receivables turnover, with a decrease in 2021 and 2023. This implies that the company has been taking longer to pay its suppliers and creditors in these years.

Finally, the working capital turnover has consistently improved over the past five years, demonstrating the company's ability to generate revenue from its working capital. This trend indicates an efficient utilization of working capital to generate sales.

In summary, while there are some fluctuations in the activity ratios, particularly in receivables and payables turnover, the overall trend suggests that TD Synnex Corp has been relatively effective in managing its inventory and working capital to drive sales. However, the company may need to focus on optimizing its receivables and payables turnover to enhance overall operational efficiency.

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Average number of days

Based on the provided data, TD Synnex Corp's activity ratios reflect its efficiency in managing inventory, receivables, and payables.

1. Days of inventory on hand (DOH):
The company's days of inventory on hand have shown a decreasing trend over the past five years, dropping from 81.57 days in 2021 to 48.67 days in 2023. This indicates that the company has improved its ability to sell and replenish its inventory more efficiently.

2. Days of sales outstanding (DSO):
The days of sales outstanding have fluctuated over the past five years, with an apparent increase in 2021 and a subsequent decrease in 2023. This suggests that the company's collection activities have been inconsistent, indicating a potential need for improvement in managing its accounts receivable.

3. Number of days of payables:
The number of days of payables has also fluctuated over the period, with a significant increase in 2021, followed by a decrease in 2023. This fluctuation suggests changes in the company's payment policies and vendor relationships.

Overall, the company's activity ratios indicate a need for consistent management of inventory, receivables, and payables to enhance efficiency and cash flow management.

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Long-term

The fixed asset turnover ratio measures the efficiency with which TD Synnex Corp utilizes its fixed assets to generate sales. The ratio has been on an increasing trend over the past five years, reaching 127.89 in 2023 from 41.69 in 2019. This indicates a significant improvement in the company's ability to generate sales relative to its investment in fixed assets.

On the other hand, the total asset turnover ratio indicates how efficiently the company uses all its assets to generate revenue. Although there has been some fluctuation in this ratio, it generally decreased from 2.03 in 2019 to 1.96 in 2023. This suggests that TD Synnex Corp's overall efficiency in generating sales from its total assets has slightly declined over the years.

Overall, the company has shown exceptional improvement in utilizing its fixed assets to generate sales, although there has been a slight decrease in the efficiency of using total assets to generate revenue. This could indicate a shift in the company's asset mix or changes in its business operations.