Vicor Corporation (VICR)

Short-term

Turnover ratios

The Inventory turnover ratio for Vicor Corporation has shown a decline over the past five years, going from 3.99 in 2020 to 2.57 in 2024. This indicates that the company's efficiency in managing its inventory has decreased over time.

In terms of Receivables turnover, there was a sharp decrease from 14.49 in 2020 to 6.12 in 2022, but it slightly improved in the subsequent years. This suggests that the company took longer to collect its receivables in 2022, but the situation has been somewhat rectified since then.

The Payables turnover ratio for Vicor Corporation has shown a fluctuating trend, with a significant increase from 2019 to 2024. This could indicate changes in the company's payment terms with its suppliers over the years.

Looking at the Working capital turnover, the ratio decreased consistently from 2020 to 2024, indicating a declining efficiency in utilizing working capital to generate revenue for the company.

Overall, these activity ratios highlight various aspects of Vicor Corporation's operational efficiency and effectiveness in managing its assets and liabilities over the past five years.

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Average number of days

Based on the provided data for Vicor Corporation, let's analyze the activity ratios:

1. Days of Inventory on Hand (DOH):
- Vicor's inventory turnover has been increasing over the years. It took 91.52 days to sell inventory in 2020, which increased to 142.29 days by 2024. This indicates that Vicor's inventory is moving at a slower pace, possibly due to changes in demand or production efficiency.

2. Days of Sales Outstanding (DSO):
- The days of sales outstanding for Vicor Corporation have fluctuated over the years. In 2020, it took 25.19 days to collect sales revenue, which increased to 52.11 days by 2024. This may suggest potential challenges in collecting receivables efficiently and managing credit terms with customers.

3. Number of Days of Payables:
- Vicor's payable days have shown a decreasing trend from 2020 to 2024. The number of days of payables decreased from 22.57 days in 2020 to 11.72 days in 2024. A decreasing trend in payable days may indicate that Vicor is paying its suppliers more quickly, potentially impacting its cash flow management.

Overall, the analysis of activity ratios for Vicor Corporation shows patterns that warrant further investigation into the company's inventory management, accounts receivable collection practices, and payment strategies to optimize operational efficiency and working capital management.

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Long-term

Vicor Corporation's fixed asset turnover ratio has shown a significant decrease from 7.94 in 2020 to 2.43 in 2024. This indicates that the company's ability to generate sales from its investment in fixed assets has declined over this period. The decline in fixed asset turnover may suggest inefficiencies in asset utilization or a reduction in the productivity of the company's fixed assets.

Similarly, the total asset turnover ratio has also declined from 1.50 in 2020 to 0.58 in 2024. This decline suggests a reduced efficiency in generating sales from the company's total assets. A decreasing total asset turnover ratio may indicate that the company is not leveraging its assets effectively to drive revenue growth.

Overall, the decreasing trend in both fixed asset turnover and total asset turnover ratios for Vicor Corporation raises concerns about the company's operational efficiency and asset utilization. It may be necessary for the company to review its asset management strategies and identify opportunities for improvement to enhance its long-term performance.