Supernus Pharmaceuticals Inc (SUPN)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 0.00 | 5.11 | 4.45 | 5.33 | 6.63 |
| Receivables turnover | — | 4.07 | 3.76 | 3.56 | 4.50 |
| Payables turnover | — | 44.34 | 40.98 | 41.88 | 17.41 |
| Working capital turnover | 2.99 | 14.57 | 1.96 | 1.30 | 1.26 |
Supernus Pharmaceuticals Inc's activity ratios provide insight into how effectively the company is managing its assets and liabilities to generate sales.
1. Inventory turnover:
The inventory turnover ratio indicates how efficiently the company is managing its inventory levels. A higher ratio is generally preferred as it suggests quicker sales of inventory. Supernus Pharmaceuticals Inc's inventory turnover has been relatively stable over the past five years, ranging from 0.87 to 1.09. The company's inventory turnover ratio increased in 2023 compared to the previous year, indicating improved efficiency in selling its inventory.
2. Receivables turnover:
The receivables turnover ratio measures how effectively the company is collecting payments from its customers. A higher ratio implies that the company is collecting its accounts receivable quickly. Supernus Pharmaceuticals Inc's receivables turnover has shown a consistent trend over the years, ranging from 3.69 to 4.50. The increase in the receivables turnover ratio from 2022 to 2023 suggests that the company has become more efficient in collecting payments from customers.
3. Payables turnover:
The payables turnover ratio reflects how quickly the company is paying its suppliers. A higher ratio indicates that the company is paying its bills promptly. Supernus Pharmaceuticals Inc's payables turnover ratio has fluctuated significantly over the years, with a sharp increase in 2023 compared to the previous year. This significant increase suggests that the company has been managing its payables more efficiently in 2023.
4. Working capital turnover:
The working capital turnover ratio measures how efficiently the company is utilizing its working capital to generate sales. A higher ratio indicates better utilization of working capital. Supernus Pharmaceuticals Inc's working capital turnover ratio has varied over the years, with a notable increase in 2022. The decrease in this ratio in 2023 compared to 2022 suggests a lower efficiency in utilizing working capital to generate sales.
In summary, Supernus Pharmaceuticals Inc has shown improvements in inventory turnover and receivables turnover ratios, indicating better efficiency in managing inventory and collecting payments. The significant increase in the payables turnover ratio reflects improved management of payables. However, the decrease in the working capital turnover ratio in 2023 suggests a potential inefficiency in utilizing working capital to generate 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 | — | 71.48 | 82.04 | 68.52 | 55.04 |
| Days of sales outstanding (DSO) | days | — | 89.75 | 97.06 | 102.64 | 81.16 |
| Number of days of payables | days | — | 8.23 | 8.91 | 8.72 | 20.96 |
Days of Inventory on Hand (DOH) measures how many days it takes for a company to sell its average inventory. In the case of Supernus Pharmaceuticals Inc, the trend in the DOH has been decreasing over the past five years, indicating that the company is managing its inventory more efficiently. However, the DOH remains relatively high, suggesting potential room for improvement in inventory management.
Days of Sales Outstanding (DSO) represents the average number of days it takes for a company to collect revenue after a sale is made. Supernus Pharmaceuticals Inc has shown a fluctuating trend in DSO over the past five years, with a slight increase in 2023 compared to 2022. The company should aim to lower DSO to improve cash flow and liquidity.
Number of Days of Payables measures how long a company takes to pay its suppliers. Supernus Pharmaceuticals Inc has significantly reduced its payment period to suppliers over the past few years, which could indicate improved bargaining power or working capital management. However, the abrupt decrease from 2021 to 2022 raises questions about the company's relationships with suppliers.
Overall, while Supernus Pharmaceuticals Inc has made progress in managing its inventory and payables, there is a need for further efficiency improvements in inventory turnover and receivables collection to enhance working capital performance.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 607,521.00 | 44.36 | 33.03 | 13.24 | 23.01 |
| Total asset turnover | 607,521.00 | 0.40 | 0.33 | 0.33 | 0.34 |
The long-term activity ratios of Supernus Pharmaceuticals Inc reveal important insights into the company's utilization of its fixed assets and total assets over the last five years.
1. Fixed Asset Turnover:
- Supernus Pharmaceuticals Inc's fixed asset turnover has shown a consistent improvement over the past five years. The ratio has increased from 23.01 in 2019 to 44.90 in 2023, indicating that the company has been generating significantly higher sales relative to its investment in fixed assets.
- A high fixed asset turnover ratio suggests that Supernus Pharmaceuticals Inc is efficiently utilizing its fixed assets to generate revenue. This efficiency can be attributed to effective management of property, plant, and equipment, leading to increased productivity and profitability.
- The rising trend in fixed asset turnover indicates that Supernus Pharmaceuticals Inc has been able to optimize its operational performance and extract more value from its fixed assets in recent years.
2. Total Asset Turnover:
- The total asset turnover ratio for Supernus Pharmaceuticals Inc has fluctuated over the last five years, with a low of 0.34 in 2020 and 2021, and a high of 0.48 in 2023. This suggests some variability in the company's ability to generate sales relative to its total assets during this period.
- While the total asset turnover ratio improved in 2023 compared to previous years, it is still relatively low, indicating that Supernus Pharmaceuticals Inc may not be efficiently utilizing its total assets to generate revenue. This could indicate potential inefficiencies in how the company manages its current and non-current assets.
- It is important for the company to focus on improving its total asset turnover ratio to ensure optimal utilization of its assets and enhance overall operational efficiency and profitability.
In conclusion, while Supernus Pharmaceuticals Inc has demonstrated efficient utilization of its fixed assets as evident from the increasing trend in fixed asset turnover, there is room for improvement in optimizing its total assets to generate higher sales and improve financial performance.