TransMedics Group Inc (TMDX)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 1.98 | 1.37 | 0.61 | 0.75 | 0.87 |
| Receivables turnover | 3.80 | 3.38 | 5.10 | 3.74 | 3.60 |
| Payables turnover | 6.88 | 8.44 | 1.37 | 7.47 | 1.34 |
| Working capital turnover | 0.53 | 0.41 | 0.32 | 0.19 | 0.28 |
TransMedics Group Inc's Inventory turnover has shown a positive trend from 0.87 in 2019 to 1.98 in 2023, indicating an improvement in how efficiently the company manages its inventory levels. This suggests that the company is selling its inventory more frequently in recent years.
The Receivables turnover has been relatively stable over the years, with a slight increase from 3.60 in 2019 to 3.80 in 2023. This ratio reflects how effectively the company is collecting payments from its customers.
The Payables turnover has fluctuated significantly from 1.34 in 2019 to 8.44 in 2022, before decreasing to 6.88 in 2023. This indicates varying payment practices with suppliers, possibly due to changes in credit terms or negotiating strategies.
The Working capital turnover has also shown an increasing trend, from 0.28 in 2019 to 0.53 in 2023, suggesting that the company is generating revenue more efficiently relative to its working capital. This reflects a positive sign of operational performance and financial management.
Overall, the activity ratios of TransMedics Group Inc demonstrate improvements in inventory management, stable receivables turnover, fluctuating payables turnover, and increasing efficiency in generating revenue relative to working capital over the years.
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 | 184.46 | 266.82 | 595.80 | 483.77 | 420.27 |
| Days of sales outstanding (DSO) | days | 96.04 | 107.83 | 71.57 | 97.72 | 101.42 |
| Number of days of payables | days | 53.03 | 43.26 | 266.68 | 48.89 | 271.55 |
TransMedics Group Inc's activity ratios, specifically the Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Number of Days of Payables, provide insights into the efficiency of the company's inventory management, sales collection processes, and payment practices.
1. Days of Inventory on Hand (DOH): The trend in the DOH ratio over the past five years indicates a fluctuating pattern. In 2023, the company had 184.46 days of inventory on hand, which is a significant improvement from 2022 when it had 266.82 days. The decreasing trend in DOH from 2022 to 2023 suggests that TransMedics Group Inc has been more effective in managing its inventory levels and turning over its inventory faster.
2. Days of Sales Outstanding (DSO): The DSO ratio reflects the average number of days it takes for the company to collect payment after making a sale. The DSO ratio decreased from 107.83 days in 2022 to 96.04 days in 2023. This suggests that TransMedics Group Inc has been able to collect payments from its customers more efficiently in 2023 compared to the previous year, indicating improved sales collection procedures.
3. Number of Days of Payables: The Number of Days of Payables ratio represents the average number of days it takes for the company to pay its suppliers. The trend in the Number of Days of Payables ratio has been relatively stable over the past five years, with some fluctuations. In 2023, TransMedics Group Inc had 53.03 days of payables, showing an increase from 43.26 days in 2022. This increase may indicate that the company is taking longer to pay its suppliers, which could impact vendor relationships.
Overall, the analysis of TransMedics Group Inc's activity ratios suggests improvements in inventory management and sales collection processes in 2023, while the payment practices to suppliers showed a slight deterioration. Maintaining an optimal balance between managing inventory efficiently, collecting sales promptly, and managing payables effectively is crucial for the company's overall financial health and operational performance.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 1.39 | 4.86 | 3.08 | 5.39 | 4.93 |
| Total asset turnover | 0.34 | 0.34 | 0.22 | 0.17 | 0.22 |
TransMedics Group Inc's long-term activity ratios provide insights into the efficiency of the company's utilization of its fixed assets and total assets over the past five years.
1. Fixed Asset Turnover:
- The fixed asset turnover ratio measures how effectively the company generates revenue from its investment in fixed assets.
- In 2023, the ratio decreased to 1.39 from 4.86 in 2022, indicating a decline in the company's ability to generate sales from its fixed assets.
- Despite the decrease, the ratio remains above 1, suggesting that TransMedics is still generating revenue efficiently from its fixed assets, although not as efficiently as in previous years.
2. Total Asset Turnover:
- The total asset turnover ratio indicates the company's ability to generate sales from its total assets.
- TransMedics maintained a stable total asset turnover ratio of 0.34 from 2022 to 2023, reflecting consistent revenue generation relative to its total asset base.
- The ratio has shown an upward trend over the past five years, indicating improved efficiency in utilizing total assets to generate sales.
Overall, TransMedics Group Inc's long-term activity ratios suggest that the company has been efficient in generating sales from its fixed assets and total assets. However, a decrease in the fixed asset turnover ratio in 2023 warrants further analysis to understand the factors impacting the company's asset utilization efficiency.