Texas Pacific Land Trust (TPL)

Short-term

Turnover ratios

The activity ratios for Texas Pacific Land Trust show fluctuations over the given periods.

1. Inventory turnover has been erratic, ranging from 0.54 to 12.73, with no data available for March 31, 2024. A higher inventory turnover indicates that the company is selling its inventory more quickly, which could imply efficient management of inventory levels or strong demand for its products.

2. Receivables turnover data is not available, indicating a lack of information on how quickly the company collects its accounts receivable.

3. Payables turnover data is also not available, which means there is no insight into how efficiently the company pays its suppliers or vendors.

4. The working capital turnover ratio has displayed some variability, ranging from 0.74 to 1.27. A higher ratio generally signifies better utilization of working capital to generate sales revenue within the given period.

In conclusion, while the inventory turnover and working capital turnover ratios provide some insights into operational efficiency and working capital management, the lack of data for receivables and payables turnover limits a comprehensive analysis of the company's overall liquidity and efficiency in managing its short-term financial obligations.

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Average number of days

The data provided for Texas Pacific Land Trust's activity ratios shows significant fluctuations in the Days of Inventory on Hand (DOH) over the past few quarters. The DOH went from extremely high levels in the previous quarters, such as 595.88 days in December 2022 and 675.73 days in September 2021, to a more reasonable figure of 28.68 days in the current quarter ending March 31, 2024. This sudden decrease suggests an improvement in inventory management efficiency or a change in the nature of the Trust's operations.

Unfortunately, data for Days of Sales Outstanding (DSO) and Number of Days of Payables are not provided in the table for analysis. Without this information, a comprehensive assessment of the Trust's overall working capital management, including accounts receivable collection and payment terms with suppliers, is not feasible.

It is advisable for the Trust to continue monitoring and managing its inventory levels effectively to ensure optimal utilization of resources and maintain a healthy cash flow position. Further insights into the Trust's operational and financial performance could be gained by examining additional activity ratios and financial metrics over time.

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Long-term

Long-term activity ratios provide insights into how efficiently a company is utilizing its fixed and total assets to generate revenue. For Texas Pacific Land Trust, the fixed asset turnover ratio has been relatively stable over the periods analyzed, ranging from 4.77 to 8.12. This indicates that the company is effectively generating revenue from its investment in fixed assets, such as land holdings, with a peak performance in the third quarter of 2022.

In contrast, the total asset turnover ratio fluctuated between 0.52 and 0.80 during the same period. This metric suggests that the company's overall efficiency in generating sales from all its assets varied more significantly compared to fixed assets alone. While there was an overall increasing trend from the end of 2021 to mid-2022, the ratio declined in the later periods.

Overall, the fixed asset turnover ratios consistently outperformed the total asset turnover ratios, indicating that Texas Pacific Land Trust is more efficient in generating revenue from its fixed assets compared to its total asset base. This analysis underscores the importance of understanding how effectively a company is using its assets to drive revenue and profitability.