SolarWinds Corp (SWI)

Short-term

Turnover ratios

Based on the provided data for SolarWinds Corp, let's analyze the activity ratios:

1. Inventory Turnover: The inventory turnover ratio is not provided for any period, indicating that specific data on how efficiently the company manages its inventory turnover is not available.

2. Receivables Turnover: The receivables turnover ratio measures how many times a company collects its average accounts receivable during a specific period. Over the analyzed quarters, SolarWinds Corp had varying receivables turnover ratios ranging between 6.05 to 8.74. This suggests that the company was able to efficiently collect outstanding receivables at different rates over time.

3. Payables Turnover: The payables turnover ratio indicates how efficiently a company manages its accounts payable. SolarWinds Corp's payables turnover ratio fluctuated significantly, ranging from 11.17 to 166.68. The sharp variations could imply changes in payment practices or relationships with suppliers.

4. Working Capital Turnover: The working capital turnover ratio assesses a company's ability to generate revenue relative to its working capital. SolarWinds Corp had fluctuating working capital turnover ratios, with some periods showing high turnover and others showing lower or negative ratios. This suggests changes in how effectively the company utilized its working capital to generate revenue.

Overall, SolarWinds Corp's activity ratios show fluctuations over the analyzed periods, indicating variations in the efficiency of managing inventory, receivables, payables, and working capital. Further analysis and comparison with industry benchmarks would provide a clearer insight into the company's operational efficiency.

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Average number of days

The activity ratios for SolarWinds Corp provide insights into the company's efficiency in managing its inventory, collecting receivables, and paying its payables.

1. Days of Inventory on Hand (DOH): The DOH ratio indicates how many days, on average, it takes for SolarWinds Corp to sell its inventory. However, the provided data shows "— days" for all the periods, suggesting that the specific inventory turnover information is not available.

2. Days of Sales Outstanding (DSO): The DSO ratio represents the average number of days it takes for SolarWinds Corp to collect its accounts receivable. The trend in the DSO values indicates the company's effectiveness in managing its receivables. Over the analyzed periods, DSO ranged from 41.75 to 60.36 days, showing fluctuations in the efficiency of collecting receivables.

3. Number of Days of Payables: This ratio illustrates how long it takes SolarWinds Corp to pay its suppliers. A decreasing trend in the number of days of payables can suggest that the company is settling its payables more swiftly. The data shows a reduction in the number of days of payables from 32.68 days to 5.54 days over the analysis timeframe, indicating that the company improved its ability to manage its payables efficiently.

In conclusion, while the Days of Inventory on Hand ratio was not available, SolarWinds Corp demonstrated varying efficiency levels in managing its receivables and payables over the analyzed periods. The improvement in managing payables suggests better cash flow management and potentially stronger supplier relationships. Further analysis and comparison with industry benchmarks could provide additional context for evaluating the company's overall activity efficiency.

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Long-term

The fixed asset turnover ratio for SolarWinds Corp has shown a general upward trend over the years, indicating that the company has become more efficient in generating sales from its fixed assets. The ratio increased from 21.43 in March 2020 to 49.75 in December 2024. This suggests that the company has been able to utilize its fixed assets more effectively to generate revenue.

On the other hand, the total asset turnover ratio has remained relatively stable over the same period, fluctuating between 0.13 and 0.25. This may indicate that while the company has improved its efficiency in utilizing fixed assets, the overall efficiency in generating sales from total assets has not seen significant changes.

Overall, the increasing trend in fixed asset turnover ratio coupled with the stable total asset turnover ratio suggests that SolarWinds Corp has managed to improve the efficiency of its fixed asset utilization, which is a positive indicator of operational performance and potential profitability.