Synnex Corporation (SNX)

Short-term

Turnover ratios

The activity ratios of Synnex Corporation reflect its efficiency in managing various aspects of its operations.

1. Inventory Turnover:
- The Inventory Turnover ratio shows how many times a company's inventory is sold and replaced over a specific period. A higher ratio indicates efficient inventory management.
- Synnex Corporation's Inventory Turnover has fluctuated over the years, ranging from 4.47 to 7.50 times.
- The average Inventory Turnover ratio of Synnex Corporation remains healthy, indicating effective management of inventory levels.

2. Receivables Turnover:
- The Receivables Turnover ratio reflects the effectiveness of the company in collecting its accounts receivable. A higher ratio suggests the company collects its receivables quickly.
- Synnex Corporation's Receivables Turnover ratio has varied from 3.80 to 6.62 times.
- The company's average Receivables Turnover ratio indicates a reasonable ability to collect its receivables efficiently.

3. Payables Turnover:
- The Payables Turnover ratio demonstrates how many times a company pays its suppliers during a specific period. A higher ratio indicates the company is efficient in paying its bills.
- Synnex Corporation's Payables Turnover ratio has ranged from 2.47 to 5.01 times.
- The company's average Payables Turnover ratio suggests a solid payment efficiency to suppliers.

4. Working Capital Turnover:
- The Working Capital Turnover ratio evaluates how effectively a company utilizes its working capital to generate revenue.
- Synnex Corporation's Working Capital Turnover has shown an increasing trend over the years, with values ranging from 9.03 to 17.20 times.
- The company's average Working Capital Turnover ratio indicates a strong utilization of working capital to drive revenue growth.

In conclusion, while there have been fluctuations in Synnex Corporation's activity ratios over the years, the company generally demonstrates efficient management of inventory, receivables, payables, and working capital. The average ratios suggest that Synnex Corporation effectively utilizes its resources to drive operational efficiency and revenue generation.

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Average number of days

Synnex Corporation's activity ratios provide insight into its operational efficiency and management of working capital.

1. Days of Inventory on Hand (DOH):
- The DOH ratio reflects how many days, on average, the company holds inventory before it is sold.
- Over the five-year period, Synnex's DOH has fluctuated, ranging from a low of 48.67 days in 2023 to a high of 81.57 days in 2021.
- The decrease in DOH from 2021 to 2023 indicates an improvement in inventory management efficiency, as the company reduced the number of days required to sell its inventory.

2. Days of Sales Outstanding (DSO):
- DSO measures how long it takes for the company to collect its accounts receivable from customers.
- Synnex's DSO has shown variability, with the lowest DSO of 55.16 days in 2022 and the highest DSO of 95.94 days in 2021.
- A decreasing trend in DSO from 2021 to 2023 suggests that Synnex has been more successful in collecting payments from customers in a timely manner.

3. Number of Days of Payables:
- This ratio represents the average number of days it takes for the company to pay its suppliers.
- Synnex's days of payables increased significantly from 2020 to 2021, more than doubling from 72.89 days to 147.78 days, before stabilizing around 90 days in the subsequent years.
- The higher number of days of payables in 2021 could indicate that the company took advantage of extended payment terms with suppliers, potentially impacting cash flow positively.

In summary, Synnex Corporation has improved its inventory management and accounts receivable collection efficiency over the five-year period, while also maintaining stability in its payables management. These trends suggest that Synnex has been focusing on optimizing its working capital management practices to enhance operational performance.

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Long-term

The fixed asset turnover ratio of Synnex Corporation indicates how efficiently the company is utilizing its fixed assets to generate revenue. A higher ratio suggests better asset utilization. In November 2020, the fixed asset turnover was 126.72, indicating that each dollar of fixed assets generated $126.72 of revenue. However, this ratio decreased to 65.39 in November 2021 before significantly increasing to 148.06 in November 2022. This surge in 2022 suggests a substantial improvement in utilizing fixed assets to generate sales. The ratio then slightly declined to 127.89 and 127.90 in November 2023 and 2024, respectively.

Total asset turnover ratio measures how efficiently a company generates revenue relative to its total assets. In November 2020, Synnex Corporation had a total asset turnover of 1.48, meaning each dollar of assets produced $1.48 in revenue. This ratio decreased to 1.14 in 2021, indicating a lower revenue generation from total assets. However, it significantly improved to 2.10 in 2022, reflecting a substantial increase in revenue generated per dollar of assets. The total asset turnover remained relatively stable at 1.96 in 2023 and 1.93 in 2024.

Overall, the alternating trends in fixed asset turnover and total asset turnover ratios for Synnex Corporation suggest fluctuations in the efficiency of asset utilization and revenue generation over the years analyzed. It is important for the company to monitor these ratios to ensure optimal utilization of assets for sustained growth and profitability.