Targa Resources Inc (TRGP)
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 | 30.59 | 21.95 | 42.52 | 104.01 | 44.05 | 30.25 | 67.03 | 114.95 | 64.14 | 34.91 | 133.22 | 133.50 | 42.36 | 29.49 | 35.04 | 81.07 | 37.89 | 30.46 | 36.47 | 40.54 |
| Receivables turnover | 10.92 | 13.19 | 18.05 | 20.02 | 14.86 | 14.21 | 12.97 | 11.66 | 12.73 | 10.91 | 13.01 | 9.87 | 9.57 | 13.38 | 14.53 | 19.22 | 10.14 | 11.82 | 15.50 | 13.72 |
| Payables turnover | 7.22 | 7.44 | 11.32 | 12.94 | 11.97 | 7.89 | 7.13 | 6.21 | 7.02 | 6.69 | 8.45 | 7.27 | 9.22 | 12.49 | 12.64 | 13.92 | 6.41 | 6.58 | 7.60 | 6.87 |
| Working capital turnover | — | — | — | — | — | — | — | — | — | — | — | — | — | 128.53 | — | 460.14 | — | — | — | — |
The inventory turnover ratio for Targa Resources Corp has shown fluctuations over the past eight quarters, ranging from a low of 20.71 in Q3 2023 to a high of 154.84 in Q1 2022. This ratio indicates the company's efficiency in managing its inventory levels and converting them into sales. A higher turnover ratio suggests that the company is selling its inventory quickly, which can be beneficial in terms of cash flow and profitability.
The receivables turnover ratio has also varied over the periods, with a peak of 20.02 in Q1 2023 and a low of 10.92 in Q4 2023. This ratio reflects how effectively Targa Resources Corp collects payments from its customers. A higher turnover ratio implies that the company efficiently collects outstanding receivables, improving liquidity and reducing the risk of bad debt.
The payables turnover ratio for Targa Resources Corp has ranged from 6.78 in Q4 2023 to 12.50 in Q1 2023. This ratio assesses how quickly the company pays its suppliers. A lower turnover ratio may indicate that the company is taking longer to pay its bills, potentially signaling cash flow or liquidity issues, while a higher ratio suggests more efficient management of payables.
Unfortunately, there is no data provided for the working capital turnover ratio, which measures the efficiency of using working capital to generate sales. It would have been insightful to analyze this ratio to understand how well Targa Resources Corp is utilizing its working capital to support its operations and finance its growth.
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 | 11.93 | 16.63 | 8.58 | 3.51 | 8.29 | 12.07 | 5.45 | 3.18 | 5.69 | 10.46 | 2.74 | 2.73 | 8.62 | 12.38 | 10.42 | 4.50 | 9.63 | 11.98 | 10.01 | 9.00 |
| Days of sales outstanding (DSO) | days | 33.43 | 27.66 | 20.22 | 18.23 | 24.56 | 25.68 | 28.14 | 31.30 | 28.68 | 33.46 | 28.05 | 36.97 | 38.12 | 27.27 | 25.13 | 18.99 | 35.99 | 30.88 | 23.54 | 26.61 |
| Number of days of payables | days | 50.58 | 49.04 | 32.25 | 28.20 | 30.48 | 46.25 | 51.20 | 58.74 | 52.02 | 54.53 | 43.21 | 50.21 | 39.59 | 29.21 | 28.87 | 26.21 | 56.96 | 55.48 | 48.04 | 53.10 |
Days of inventory on hand (DOH) measures how many days it takes for the company to sell its entire inventory. In Q4 2023, Targa Resources Corp had 12.70 days of inventory on hand, which was higher compared to the previous quarter (Q3 2023) but still within a reasonable range. However, there was a notable increase from the same period last year (Q4 2022). This could suggest either an increase in inventory levels or a decrease in sales.
Days of sales outstanding (DSO) indicates the average number of days it takes for the company to collect revenue after a sale is made. In Q4 2023, Targa Resources Corp had a DSO of 33.43 days, showing an increase from the previous quarter. This could imply that the company is taking longer to collect payments from its customers compared to the previous quarter. However, the DSO has been fluctuating over the past year, indicating potential challenges in managing accounts receivable efficiently.
The number of days of payables measures how long it takes the company to pay its suppliers. Targa Resources Corp had 53.84 days of payables in Q4 2023, which was higher than the previous quarter. This indicates that the company is taking longer to pay its suppliers compared to the previous quarter. It's important to note that the number of days of payables has been increasing over the past year, which could suggest a deliberate strategy to manage cash flow or potential liquidity constraints.
Overall, Targa Resources Corp's activity ratios suggest some fluctuations and trends that may require further investigation to understand the underlying reasons and implications for the company's operational efficiency and financial health.
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 | 1.02 | 1.07 | 1.20 | 1.42 | 1.47 | 1.59 | 1.76 | 1.57 | 1.45 | 1.18 | 0.98 | 0.82 | 0.68 | 0.66 | 0.64 | 0.68 | 0.60 | 0.60 | 0.69 | 0.75 |
| Total asset turnover | 0.78 | 0.81 | 0.92 | 1.08 | 1.07 | 1.13 | 1.36 | 1.19 | 1.11 | 0.88 | 0.76 | 0.63 | 0.52 | 0.51 | 0.50 | 0.53 | 0.46 | 0.46 | 0.54 | 0.59 |
The fixed asset turnover ratio for Targa Resources Corp has been fluctuating over the past eight quarters, ranging from 1.02 to 1.76. This ratio indicates how efficiently the company is generating revenue from its fixed assets. A higher ratio suggests that the company is effectively utilizing its fixed assets to generate sales.
On the other hand, the total asset turnover ratio has also exhibited variability, ranging from 0.78 to 1.36. This ratio reflects how well the company is generating sales from all its assets, including both fixed and current assets. A higher total asset turnover ratio indicates that the company is efficiently using all its assets to generate revenue.
In terms of trends, both the fixed asset turnover and total asset turnover ratios have shown some fluctuations over the quarters. It's worth noting that the fixed asset turnover ratio tends to be higher and more stable compared to the total asset turnover ratio. This suggests that Targa Resources Corp may be more efficient in utilizing its fixed assets than its total assets to generate revenue.
Overall, it would be advisable for Targa Resources Corp to closely monitor and analyze these long-term activity ratios to ensure optimal asset utilization and revenue generation efficiency.