Tandem Diabetes Care Inc (TNDM)

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 4.71 3.88 3.83 4.11 4.71 6.69 7.54 7.90 8.75 8.54 7.83 7.20 7.10 5.81 6.27 6.11 6.92 7.67 10.16 10.32
Receivables turnover 7.00 7.60 7.95 8.64 6.94 6.97 7.34 7.79 6.30 7.50 7.44 7.22 5.97 8.27 9.04 7.30 7.78 7.28 5.68 6.44
Payables turnover 14.99 12.06 9.91 9.80 9.39 11.39 13.11 13.93 21.40 20.82 18.99 17.08 25.41 20.03 23.86 16.95 19.13 19.15 29.98 21.02
Working capital turnover 1.34 1.34 1.33 1.35 1.16 1.19 1.09 1.07 1.03 1.03 1.01 0.95 0.92 0.89 0.96 2.18 2.05 2.26 2.13 1.95

Activity ratios provide insight into how efficiently a company is managing its resources and operations.

1. Inventory Turnover: Tandem Diabetes Care Inc's inventory turnover has been gradually declining from 4.30 in Q1 2022 to 2.41 in Q4 2023. This suggests that the company is selling through its inventory at a slower rate, which could indicate overstocking or slowing sales.

2. Receivables Turnover: The receivables turnover ratio has shown a consistent increase from 7.01 in Q3 2022 to 8.70 in Q1 2023, indicating that Tandem Diabetes Care Inc is collecting its receivables more quickly. This is a positive sign that the company is efficiently managing its accounts receivable.

3. Payables Turnover: The payables turnover ratio has fluctuated over the quarters, with a peak of 8.27 in Q3 2023. A higher ratio indicates that Tandem Diabetes Care Inc is paying its suppliers more quickly. However, the variability in this ratio may be due to changes in payment terms or supplier relationships.

4. Working Capital Turnover: Tandem Diabetes Care Inc's working capital turnover has been relatively stable, hovering around 1.35 in the most recent quarters. This ratio indicates how effectively the company is using its working capital to generate revenue. A stable ratio suggests consistent efficiency in utilizing resources.

Overall, Tandem Diabetes Care Inc's activity ratios highlight areas of strength, such as efficient receivables management, as well as potential areas for improvement, such as inventory turnover. It is essential for the company to monitor these ratios regularly to optimize its operational efficiency and financial performance.

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 77.54 94.13 95.28 88.70 77.53 54.58 48.41 46.23 41.72 42.73 46.62 50.67 51.41 62.80 58.17 59.76 52.75 47.58 35.92 35.37
Days of sales outstanding (DSO) days 52.13 48.00 45.90 42.26 52.56 52.38 49.75 46.87 57.91 48.67 49.08 50.55 61.13 44.12 40.39 49.97 46.94 50.13 64.29 56.66
Number of days of payables days 24.34 30.27 36.85 37.24 38.88 32.05 27.84 26.20 17.06 17.53 19.22 21.37 14.36 18.22 15.29 21.53 19.08 19.06 12.18 17.36

Tandem Diabetes Care Inc's activity ratios, specifically Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Number of Days of Payables, provide insights into how efficiently the company manages its inventory, collects receivables, and pays its suppliers.

1. Days of Inventory on Hand (DOH): The trend analysis of DOH indicates an increasing trend throughout 2022 and 2023, suggesting that the company is holding inventory for a longer period. This may imply potential issues with inventory management, such as overstocking or slowing sales. Tandem Diabetes Care Inc should monitor its inventory levels closely to avoid excess holding costs and potential obsolescence.

2. Days of Sales Outstanding (DSO): The DSO trend shows slight fluctuations but remains relatively stable over the quarters in 2022 and 2023. A lower DSO indicates that the company is efficiently collecting payments from customers, whereas a higher DSO may imply credit issues or delays in payment collection. Tandem Diabetes Care Inc should aim to maintain a healthy balance in collecting receivables promptly without jeopardizing customer relationships.

3. Number of Days of Payables: The trend in the days of payables shows fluctuations but generally remains consistent in 2022 and 2023. A longer period of payables suggests favorable terms with suppliers, allowing Tandem Diabetes Care Inc to preserve cash or manage working capital effectively. However, an excessively long payables period could strain supplier relationships or indicate cash flow difficulties. The company should continue to manage payables strategically to ensure a balance between cash preservation and maintaining supplier goodwill.

In conclusion, Tandem Diabetes Care Inc can enhance its operational efficiency by closely monitoring and managing its inventory levels, receivables collection process, and payables period to optimize working capital and maintain strong supplier and customer relationships.

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 9.66 10.07 10.64 10.59 11.62 10.78 12.92 14.67 13.85 13.22 12.20 10.54 9.81 8.74 9.17 10.48 11.00 11.76 12.09 12.38
Total asset turnover 0.78 0.81 0.83 0.83 0.76 0.75 0.73 0.72 0.77 0.77 0.75 0.71 0.69 0.64 0.66 1.15 1.11 1.13 1.08 0.99

The fixed asset turnover ratio for Tandem Diabetes Care Inc has been relatively stable over the past eight quarters, ranging from 9.77 to 14.76. This indicates that the company generates between approximately 9.77 and 14.76 in sales for every dollar of fixed assets it owns. A higher fixed asset turnover ratio typically suggests that a company is using its fixed assets more efficiently to generate sales. Tandem Diabetes Care Inc's fixed asset turnover has shown some fluctuations, but overall, it remains at a relatively high level.

On the other hand, the total asset turnover ratio for the company has also been relatively consistent, fluctuating between 0.73 and 0.83 over the same period. This ratio represents the company's ability to generate sales from all of its assets. A higher total asset turnover ratio implies that the company is efficiently utilizing its assets to generate revenue. Tandem Diabetes Care Inc's total asset turnover ratio has shown improvement over time, indicating that the company has been more effective in generating sales from its total assets.

Overall, the analysis of Tandem Diabetes Care Inc's long-term activity ratios suggests that the company has been effectively utilizing both its fixed assets and total assets to generate sales. The stability and improvements in these ratios over the quarters indicate efficient asset management and operational performance.