Vector Group Ltd (VGR)

Short-term

Turnover ratios

Inventory turnover for Vector Group Ltd has been relatively stable over the past five years, with a range between 8.13 and 14.02. This indicates that the company is efficient in managing its inventory levels and converting inventory into sales.

Receivables turnover has shown some variability, with a significant increase in 2023 compared to the previous years. This suggests that Vector Group Ltd has been able to collect its accounts receivable more effectively in the most recent year, which is a positive sign of liquidity management.

Payables turnover has also fluctuated over the years, with a notable increase in 2023. This indicates that the company is taking longer to pay its suppliers, which could be beneficial for cash flow management or negotiating better payment terms.

Working capital turnover has decreased steadily over the five-year period, indicating that the company is generating less revenue for every unit of working capital invested. This may raise concerns about the efficiency of working capital utilization and the company's ability to generate sales with its current level of assets.

Overall, the analysis of Vector Group Ltd's activity ratios suggests a mixed performance in terms of inventory, receivables, payables, and working capital management over the past five years. Further examination and comparison with industry peers may provide additional insights into the company's operational efficiency and financial health.

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Average number of days

The activity ratios for Vector Group Ltd provide insights into the efficiency of the company's operations in managing inventory, collecting receivables, and paying its suppliers.

1. Days of Inventory on Hand (DOH):
- The DOH measures how many days, on average, inventory is held by the company before being sold.
- The trend shows fluctuation with a notable increase in 2021 and a decrease in 2023 compared to the previous years.
- A lower DOH indicates efficient inventory management by promptly converting inventory into sales.

2. Days of Sales Outstanding (DSO):
- The DSO reflects the average number of days it takes for the company to collect payments from customers.
- The DSO has varied over the years, with a significant increase in 2022 and a decrease in 2023.
- A lower DSO signifies quicker collection of receivables, improving cash flow for the company.

3. Number of Days of Payables:
- This ratio indicates how long the company takes to pay its suppliers.
- The trend shows some variability, with a notable increase in 2021 and a decrease in 2023.
- A longer payment period (higher number of days of payables) can benefit cash flow management but may strain supplier relationships if excessively long.

Overall, analyzing these activity ratios together can provide a comprehensive view of Vector Group Ltd's operational efficiency in managing its inventory, receivables, and payables. Monitoring these ratios over time helps identify trends and areas for improvement in the company's working capital management.

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Long-term

The fixed asset turnover ratio measures how effectively a company is generating sales from its fixed assets. Vector Group Ltd's fixed asset turnover has shown a fluctuating trend over the past five years, ranging from 23.17 in 2019 to 36.41 in 2022. This indicates that the company has been able to efficiently utilize its fixed assets to generate revenue, although there was a slight decrease in 2023.

On the other hand, the total asset turnover ratio reflects how efficiently a company is using all its assets to generate sales. Vector Group Ltd's total asset turnover has also shown variability, with values ranging from 1.26 in 2019 to 1.59 in 2022. The company has generally maintained a reasonable level of total asset turnover, suggesting that it effectively utilizes its total assets to generate sales.

Overall, both the fixed asset turnover and total asset turnover ratios for Vector Group Ltd indicate a positive trend in the efficient utilization of assets to drive sales, with fluctuations observed over the years. It is essential for the company to consistently monitor and optimize its asset utilization to sustain and improve its operational efficiency in the long term.