Trimble Inc (TRMB)

Short-term

Turnover ratios

Based on the provided data for Trimble Inc's activity ratios, we can draw the following insights:

1. Inventory Turnover:
- The inventory turnover ratio measures how effectively a company manages its inventory. Trimble's inventory turnover has been fluctuating over the years, decreasing from 4.62 in 2020 to 3.90 in 2022 before increasing to 6.13 in 2024.
- A higher inventory turnover ratio generally indicates better inventory management and faster sales conversion.

2. Receivables Turnover:
- The receivables turnover ratio reflects how efficient a company is in collecting its outstanding receivables. The data shows that Trimble did not provide receivables turnover numbers for the years 2020 to 2024.
- Without this information, it is challenging to assess Trimble's effectiveness in collecting receivables or how quickly it converts credit sales into cash.

3. Payables Turnover:
- The payables turnover ratio evaluates how quickly a company pays its suppliers. Similar to receivables turnover, no data is available for Trimble's payables turnover for the years 2020 to 2024.
- This lack of information makes it difficult to analyze how efficiently Trimble manages its accounts payable and relationships with suppliers.

4. Working Capital Turnover:
- The working capital turnover ratio measures how well a company utilizes its working capital to generate sales. Trimble's working capital turnover has shown significant fluctuations, with a notably high value of 2,374.19 in 2023.
- Such a high ratio in 2023 could indicate that Trimble efficiently utilized its working capital to generate sales during that year.

In conclusion, while Trimble's inventory turnover and working capital turnover ratios provide some insights into its operational efficiency, the absence of data for receivables turnover and payables turnover limits a comprehensive analysis of the company's overall activity and liquidity management. Tracking these ratios consistently over time can help investors and analysts assess Trimble's performance in managing its assets and liabilities effectively.

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Average number of days

Based on the provided data for Trimble Inc, let's analyze the activity ratios:

1. Days of Inventory on Hand (DOH):
- Trimble's DOH has shown some fluctuation over the years, ranging from 54.81 days to 93.53 days.
- A higher number of days indicates that Trimble is holding inventory for a longer period before it is sold, which may tie up the company's capital.
- The increase in DOH from 2020 to 2022 suggests that Trimble may have experienced challenges in managing its inventory efficiently.
- However, the decrease in DOH from 2022 to 2024 indicates a positive trend of inventory management, as the company is holding inventory for a shorter period.

2. Days of Sales Outstanding (DSO):
- The DSO data is not provided, which makes it challenging to evaluate Trimble's collection efficiency.
- A lower DSO would indicate that Trimble is collecting its receivables quickly, while a higher DSO may suggest potential issues with collecting payments from customers.

3. Number of Days of Payables:
- Similar to DSO, data on the Number of Days of Payables is not available, making it difficult to assess Trimble's payment practices.
- A longer payment period may indicate that Trimble is effectively managing its cash flow by delaying payments to suppliers.
- Conversely, a shorter payment period may signal that Trimble is facing pressure to settle its payables promptly.

In conclusion, based on the provided activity ratios data, Trimble Inc seems to experience some challenges in inventory management from 2020 to 2022, as reflected in the increase in Days of Inventory on Hand. However, there is an improvement in inventory management efficiency from 2022 to 2024. Further analysis of Days of Sales Outstanding and Number of Days of Payables would provide a more comprehensive understanding of Trimble's overall operational efficiency.

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Long-term

Long-term activity ratios provide insight into a company's efficiency in utilizing its long-term assets to generate sales. Two key ratios we can analyze for Trimble Inc based on the provided data are the Fixed Asset Turnover and Total Asset Turnover ratios.

1. Fixed Asset Turnover:
- The Fixed Asset Turnover ratio for Trimble Inc declined from 12.50 in 2020 to 9.78 in 2021, indicating that the company generated $9.78 in sales for every $1 of fixed assets in 2021 compared to $12.50 in 2020. This suggests a decrease in the efficiency of utilizing fixed assets to generate revenue during the year.
- The ratio then improved significantly to 16.79 in 2022, indicating that the company generated $16.79 in sales for every $1 of fixed assets, showing a substantial increase in efficiency in utilizing fixed assets to generate revenue.
- Data for 2023 and 2024 is not available, but based on the trend, it would be interesting to see if this efficiency in utilizing fixed assets is sustained in the following years.

2. Total Asset Turnover:
- The Total Asset Turnover ratio for Trimble Inc saw a slight increase from 0.46 in 2020 to 0.52 in 2021, indicating that the company generated $0.52 in sales for every $1 of total assets in 2021 compared to $0.46 in 2020. This suggests an improvement in the efficiency of utilizing total assets to generate revenue during the year.
- The ratio then decreased to 0.51 in 2022 and further to 0.40 in 2023, indicating a decline in the efficiency of utilizing total assets to generate revenue.
- The ratio continued to decline to 0.39 in 2024, suggesting a further decrease in efficiency in generating sales from total assets. This trend indicates a potential inefficiency in utilizing assets to drive revenue growth during these years.

In summary, the Fixed Asset Turnover ratio showed fluctuations, with a significant improvement in 2022, while the Total Asset Turnover ratio displayed a mixed trend with a decline seen in the later years. Monitoring these ratios can provide insights into how effectively Trimble Inc is utilizing its assets to generate sales and identify opportunities for improvement in operational efficiency.