Ultra Clean Holdings Inc (UCTT)
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 | 3.89 | 4.07 | 4.45 | 4.20 | 4.30 | 4.78 | 4.61 | 4.07 | 4.41 | 4.55 | 4.39 | 6.25 | 6.14 | 5.96 | 4.97 | 4.86 | 5.04 | 5.54 | 5.14 | 4.83 |
| Receivables turnover | 9.59 | 10.89 | 11.51 | 11.79 | 9.36 | 10.27 | — | — | 8.40 | 7.98 | 7.92 | 8.90 | 9.61 | 9.04 | 8.69 | 9.96 | 9.46 | 9.40 | — | 9.39 |
| Payables turnover | 7.55 | 8.22 | 9.17 | 9.28 | 7.53 | 7.14 | 7.19 | 6.22 | 5.02 | 5.45 | 5.74 | 7.17 | 9.12 | 9.38 | 6.87 | 7.03 | 6.53 | 8.42 | 8.67 | 8.77 |
| Working capital turnover | 2.97 | 2.94 | 3.21 | 3.36 | 3.35 | 3.32 | 3.27 | 3.19 | 3.15 | 2.89 | 2.59 | 4.01 | 4.07 | 4.13 | 3.56 | 3.58 | 4.16 | 3.70 | 3.39 | 3.28 |
Ultra Clean Holdings Inc's inventory turnover has been relatively stable over the periods analyzed, ranging from 3.89 to 6.25. This suggests that the company is managing its inventory efficiently and effectively, with a moderate rate of turnover.
The receivables turnover ratio has shown some fluctuation but generally remained healthy, ranging from 7.92 to 11.79. This indicates that Ultra Clean is collecting its accounts receivable in a timely manner and efficiently converting credit sales into cash.
The payables turnover ratio has also varied but stayed within a reasonable range, from 5.02 to 9.38. This implies that the company is effectively managing its accounts payable by paying off its obligations within a reasonable timeframe.
The working capital turnover ratio has generally been consistent, with values between 2.59 and 4.13. This indicates that Ultra Clean is efficiently utilizing its working capital to generate sales revenue.
Overall, based on the activity ratios analyzed, Ultra Clean Holdings Inc appears to be effectively managing its operational activities related to inventory, receivables, payables, and working capital. These ratios suggest that the company is maintaining good liquidity, efficient asset turnover, and effective management of its working capital.
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 | 93.80 | 89.57 | 82.08 | 86.88 | 84.86 | 76.32 | 79.23 | 89.72 | 82.80 | 80.18 | 83.09 | 58.41 | 59.49 | 61.24 | 73.45 | 75.06 | 72.38 | 65.87 | 71.02 | 75.64 |
| Days of sales outstanding (DSO) | days | 38.05 | 33.53 | 31.70 | 30.96 | 39.00 | 35.55 | — | — | 43.44 | 45.72 | 46.10 | 41.01 | 37.97 | 40.37 | 42.02 | 36.66 | 38.58 | 38.85 | — | 38.88 |
| Number of days of payables | days | 48.32 | 44.40 | 39.81 | 39.32 | 48.46 | 51.11 | 50.73 | 58.70 | 72.69 | 67.02 | 63.55 | 50.91 | 40.00 | 38.91 | 53.10 | 51.90 | 55.88 | 43.33 | 42.12 | 41.62 |
Days of inventory on hand (DOH) measures how efficiently Ultra Clean Holdings Inc manages its inventory. The trend shows fluctuation in the number of days the company holds inventory, with a peak of 93.80 days in Dec 2023. Generally, a lower DOH is favorable as it indicates faster turnover of inventory.
Days of sales outstanding (DSO) reflects how effectively the company collects its accounts receivable. The trend indicates variability in collection periods, with a decrease in DSO from Dec 2022 to Mar 2023, followed by an increase. A lower DSO suggests faster cash collection.
Number of days of payables measures how long Ultra Clean Holdings takes to pay its suppliers. The trend shows fluctuation in payment periods, with a peak of 72.69 days in Dec 2021. A longer payable period can indicate strong negotiation power but may strain supplier relationships if too extended.
Overall, further analysis is needed to understand the factors driving these fluctuations and whether they align with the company's operational efficiency and financial strategies.
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 | 5.28 | 6.01 | 6.71 | 7.74 | 8.49 | 10.00 | 9.42 | 8.99 | 8.67 | 8.14 | 7.63 | 9.51 | 8.79 | 8.74 | 8.15 | 7.86 | 7.34 | 7.22 | 7.04 | 7.38 |
| Total asset turnover | 0.93 | 1.01 | 1.12 | 1.20 | 1.21 | 1.24 | 1.20 | 1.12 | 1.04 | 0.96 | 0.90 | 1.26 | 1.27 | 1.24 | 1.09 | 1.05 | 1.05 | 1.02 | 1.01 | 1.02 |
Ultra Clean Holdings Inc's long-term activity ratios show the efficiency with which the company utilizes its assets to generate sales.
1. Fixed asset turnover:
- The fixed asset turnover ratio measures how well the company is using its fixed assets to generate revenue.
- Over the period, the fixed asset turnover has been decreasing moderately from 10.00 in Sep 2022 to 5.28 in Dec 2023.
- A decreasing trend in fixed asset turnover may indicate that the company is not effectively utilizing its fixed assets to generate sales.
- Nevertheless, the current ratio of 5.28 in Dec 2023 still indicates that Ultra Clean Holdings Inc is generating $5.28 in sales for every $1 of fixed assets.
2. Total asset turnover:
- The total asset turnover ratio indicates the company's overall efficiency in utilizing all its assets to generate revenue.
- Ultra Clean Holdings Inc's total asset turnover has fluctuated over the period, peaking at 1.27 in Sep 2020 and hitting a low of 0.90 in Jun 2021 before showing a slight increasing trend to 1.01 in Mar 2019.
- A low total asset turnover ratio may suggest that the company is not efficient in generating sales relative to its total assets.
- However, the current ratio of 0.93 in Dec 2023 implies that Ultra Clean Holdings Inc generates $0.93 in sales for every $1 of total assets, indicating room for improvement in asset utilization efficiency.
In conclusion, while Ultra Clean Holdings Inc has shown fluctuations in its long-term activity ratios over the period, there appears to be some inefficiency in utilizing both fixed and total assets to generate sales. The company may need to evaluate its asset management strategies to improve efficiency and profitability.