Stryker Corporation (SYK)

Activity ratios

Short-term

Turnover ratios

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Inventory turnover	1.54	1.49	1.58	1.64	1.72	1.69	1.70	1.77	1.85	1.76	1.69	1.58	1.52	1.50	1.50	1.55	1.74	1.56	1.54	1.56
Receivables turnover	5.44	6.07	5.97	5.89	5.18	5.78	5.61	5.83	5.66	5.92	5.99	5.63	5.31	5.86	6.39	5.65	5.14	5.97	5.90	6.08
Payables turnover	4.90	5.63	5.46	5.19	4.86	5.41	5.50	5.75	5.44	6.46	6.70	7.15	6.54	8.00	8.12	7.08	7.69	7.74	8.00	7.74
Working capital turnover	4.46	5.54	5.45	4.42	4.64	3.78	3.99	4.04	3.13	3.33	3.40	2.93	3.08	1.61	1.68	2.28	2.24	3.13	3.35	3.32

Stryker Corp.'s activity ratios provide insights into how efficiently the company is managing its assets and operations.

1. Inventory Turnover: The inventory turnover ratio measures how effectively the company is managing its inventory levels. Stryker's inventory turnover has been gradually declining from Q1 2023 to Q4 2023. This decline suggests that the company is selling its inventory at a slower rate, which may indicate excess or obsolete inventory on hand.

2. Receivables Turnover: The receivables turnover ratio indicates how efficiently Stryker is collecting payments from its customers. The trend shows some fluctuation but overall, the receivables turnover has been relatively stable. A higher turnover ratio signifies that the company is collecting its receivables quickly, which is a positive indicator of effective credit management.

3. Payables Turnover: The payables turnover ratio reflects how efficiently Stryker is managing its accounts payable. The trend indicates a slight increase in payables turnover over the periods shown. A higher turnover ratio indicates that the company is paying its suppliers more quickly. While faster payments can improve relationships with suppliers, it may also impact cash flow management.

4. Working Capital Turnover: The working capital turnover ratio measures how effectively Stryker is utilizing its working capital to generate sales. The fluctuating trend of this ratio indicates varying levels of efficiency in utilizing working capital over the periods shown. A higher turnover ratio indicates that the company is efficiently using its working capital to drive sales, while a lower ratio may suggest inefficiencies in working capital management.

Overall, analyzing these activity ratios collectively provides valuable insights into Stryker Corp.'s operational efficiency, inventory management, accounts receivable collection, and working capital utilization. It is important for the company to monitor these ratios regularly to identify areas for improvement and maintain financial health.

Average number of days

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Days of inventory on hand (DOH)	days	237.59	244.35	231.55	223.00	212.22	216.02	214.41	206.29	197.00	207.90	216.40	231.28	240.90	243.87	243.57	235.23	209.66	233.96	236.77	233.38
Days of sales outstanding (DSO)	days	67.04	60.13	61.18	61.92	70.53	63.10	65.12	62.63	64.47	61.68	60.98	64.88	68.70	62.27	57.15	64.58	70.94	61.16	61.88	60.08
Number of days of payables	days	74.42	64.85	66.85	70.30	75.06	67.48	66.34	63.44	67.11	56.55	54.49	51.08	55.85	45.62	44.94	51.54	47.49	47.16	45.61	47.15

The activity ratios of Stryker Corp. indicate the efficiency of the company in managing its inventory, collecting receivables, and paying its suppliers.

1. Days of Inventory on Hand (DOH): The trend in the DOH ratio shows an increase in the number of days it takes for Stryker Corp. to sell its inventory from Q1 2022 to Q4 2023. This suggests that the company may be carrying excess inventory or facing challenges in selling its products efficiently. It is important for Stryker Corp. to closely monitor its inventory levels to avoid potential obsolescence and costs associated with holding excess inventory.

2. Days of Sales Outstanding (DSO): The DSO ratio reflects the average number of days it takes for the company to collect payment from its customers after a sale. The trend indicates a fluctuation in collection efficiency, with some quarters showing improvement and others showing a slight deterioration. Stryker Corp. should focus on maintaining consistent collection efforts to improve cash flow and reduce the risk of bad debts.

3. Number of Days of Payables: The number of days of payables represents the average number of days it takes for Stryker Corp. to pay its suppliers. The trend in this ratio indicates a variation in the company's payment practices, with some quarters showing longer payment cycles and others showing shorter cycles. Managing payables effectively is crucial for optimizing working capital and maintaining good relationships with suppliers.

Overall, Stryker Corp. should aim to strike a balance between managing inventory levels, collecting receivables promptly, and optimizing payment terms with suppliers to enhance operational efficiency and financial performance. Regular monitoring and analysis of these activity ratios can provide valuable insights into the company's liquidity and working capital management.

Long-term

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Fixed asset turnover	6.38	6.40	6.31	6.24	6.21	6.41	6.29	6.24	6.04	6.07	5.93	5.43	5.21	5.62	5.57	5.74	5.80	5.91	5.95	6.04
Total asset turnover	0.51	0.52	0.52	0.51	0.50	0.50	0.49	0.48	0.49	0.49	0.48	0.44	0.42	0.44	0.45	0.51	0.49	0.55	0.54	0.53

Stryker Corp.'s long-term activity ratios can provide insight into the efficiency of the company's asset management. The fixed asset turnover ratio remained relatively stable over the past eight quarters, ranging between 6.21 and 6.41. This indicates that Stryker is generating consistent sales revenue in relation to its investment in fixed assets, such as property, plant, and equipment.

On the other hand, the total asset turnover ratio also showed consistency, with values between 0.48 and 0.52. Despite slight fluctuations, the company seems to be efficiently utilizing its total assets to generate sales.

In general, both ratios suggest that Stryker Corp. is effectively managing its assets to generate revenue, with the fixed asset turnover ratio highlighting the efficiency of the company's use of fixed assets specifically. These consistent ratios indicate a stable operational performance in terms of asset turnover over the analyzed periods.