TripAdvisor Inc (TRIP)

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 — — — — — — — — — — — — — 19.00 — — — — — —
Receivables turnover 9.08 8.00 6.25 7.00 8.39 8.91 5.96 5.51 5.58 3.60 3.59 3.27 4.72 6.13 8.76 8.11 8.85 7.40 6.13 7.10
Payables turnover 49.61 20.09 28.45 37.03 30.00 16.15 19.66 74.83 30.44 34.41 44.87 48.38 38.50 54.29 67.08 28.26 88.45 60.44 73.69 88.00
Working capital turnover 2.41 2.51 2.62 2.31 1.97 1.82 1.73 1.73 1.48 1.22 1.03 0.71 1.71 2.09 1.80 2.08 15.89 2.20 2.53 2.92

From the data provided, we can observe the following trends in TripAdvisor Inc.'s activity ratios:

1. Receivables Turnover:
The receivables turnover ratio indicates the efficiency of the company in collecting payments from its customers. An increasing trend in receivables turnover, from 4.55 in Q1 2022 to 9.31 in Q4 2023, suggests that TripAdvisor Inc. has been more effective in converting its accounts receivables into cash over time. This improvement signifies better credit control and collection efforts, leading to faster cash inflows.

2. Payables Turnover:
The payables turnover ratio measures how quickly a company pays off its suppliers. TripAdvisor Inc.’s payables turnover has fluctuated over the quarters, with a peak of 7.00 in Q1 2022. A higher turnover ratio implies that the company is efficiently managing its payables by promptly settling its obligations, enhancing its relationship with suppliers. However, the volatility in this ratio might warrant closer scrutiny into the company's payment practices.

3. Working Capital Turnover:
The working capital turnover ratio assesses how effectively a company utilizes its working capital to generate revenue. TripAdvisor Inc.'s working capital turnover has shown a slightly increasing trend, indicating improved efficiency in utilizing its current assets to support its operations and generate sales. A higher working capital turnover suggests that the company is generating more revenue per unit of working capital employed.

The absence of data for the inventory turnover ratio in the provided table limits our ability to evaluate TripAdvisor Inc.'s efficiency in managing its inventory levels. Nonetheless, the analysis of receivables, payables, and working capital turnover ratios provides insights into the company's operational efficiency, liquidity management, and overall effectiveness in utilizing its resources to drive revenue generation.

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 — — — — — — — — — — — — — 19.21 — — — — — —
Days of sales outstanding (DSO) days 40.18 45.62 58.38 52.14 43.52 40.95 61.25 66.20 65.36 101.36 101.67 111.68 77.39 59.54 41.68 45.03 41.26 49.35 59.58 51.43
Number of days of payables days 7.36 18.17 12.83 9.86 12.17 22.60 18.57 4.88 11.99 10.61 8.14 7.54 9.48 6.72 5.44 12.91 4.13 6.04 4.95 4.15

Days of inventory on hand (DOH) provides insight into how efficiently TripAdvisor manages its inventory. Unfortunately, the data for DOH is missing in the provided table, which limits our ability to assess this aspect of the company's operations.

Days of sales outstanding (DSO) indicates how quickly TripAdvisor collects payments from its customers. The trend of DSO seems to fluctuate, with the number of days ranging from a low of 39.19 days in Q4 2023 to a high of 80.29 days in Q1 2022. A lower DSO is generally favorable as it signifies faster cash conversion.

Number of days of payables represents the average number of days a company takes to pay its suppliers. TripAdvisor significantly extended its payment period in Q3 2022 with 232.90 days, significantly reducing it to 52.14 days in Q1 2022. This indicates fluctuations in the company's payment practices.

Overall, while the trend in days of sales outstanding is somewhat erratic, significant changes in the number of days of payables indicate that TripAdvisor may be adjusting its payment terms with suppliers. The absence of DOH data limits a comprehensive analysis of TripAdvisor's efficiency in managing inventory relative to its sales and payables cycles. It may be beneficial for the company to focus on reducing DSO further and maintaining stable payment practices to enhance its 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 9.13 8.87 8.44 8.05 7.48 6.86 5.87 4.78 4.00 3.32 2.57 1.76 2.36 3.19 4.19 5.44 5.77 5.92 6.10 6.27
Total asset turnover 0.69 0.65 0.60 0.58 0.56 0.52 0.45 0.42 0.38 0.32 0.24 0.18 0.29 0.40 0.48 0.60 0.78 0.64 0.62 0.67

TripAdvisor Inc.'s fixed asset turnover has shown a consistent upward trend over the past eight quarters, reaching 9.36 in Q4 2023 from 4.98 in Q1 2022. This indicates that the company is generating more revenue per dollar invested in fixed assets, reflecting improved efficiency in asset utilization.

In contrast, the total asset turnover has also been increasing steadily over the same period, albeit at a slower pace, indicating that TripAdvisor is generating more sales relative to its total assets. It increased from 0.44 in Q1 2022 to 0.70 in Q4 2023.

The higher fixed asset turnover compared to total asset turnover suggests that TripAdvisor is effectively utilizing its fixed assets to generate sales, which may be due to effective asset management or increased productivity. Overall, the upward trends in both ratios indicate improving efficiency and productivity in the company's long-term asset management.