Vontier Corp (VNT)

Short-term

Turnover ratios

Based on the provided data for Vontier Corp, let's analyze the activity ratios:

1. Inventory Turnover:
- The inventory turnover ratio measures how many times a company sells and replaces its inventory during a specific period.
- Vontier's inventory turnover varied over the reporting periods, ranging from a high of 8.24 times at the end of December 2021 to a low of 1.99 times by the end of September 2024.
- A decreasing trend from 2023 to 2024 suggests that the company might be struggling to efficiently manage its inventory.

2. Receivables Turnover:
- The receivables turnover ratio reflects how well a company is managing its credit policy.
- Vontier's receivables turnover varied with values ranging from a low of 4.72 to a high of 5.55.
- The absence of values for some quarters in 2022 might indicate incomplete information or changes in reporting practices.

3. Payables Turnover:
- The payables turnover ratio demonstrates how effectively a company is managing its payments to suppliers.
- Vontier's payables turnover increased from 5.56 in December 2021 to 7.31 in June 2023, before dropping significantly to 1.79 by September 2024.
- A decline in this ratio could suggest potential liquidity issues or changes in payment terms with suppliers.

4. Working Capital Turnover:
- The working capital turnover ratio shows how efficiently a company is using its working capital to generate sales.
- Vontier's working capital turnover fluctuated, reaching a peak of 8.22 at the end of December 2023 and dropping to 5.70 by September 2024.
- A decreasing trend in this ratio could indicate challenges in optimizing working capital efficiency.

In conclusion, Vontier Corp's activity ratios show variability over the reported periods, signaling potential areas for improvement in inventory management, credit policies, payment practices, and working capital utilization. Monitoring these ratios can provide insights into the company's operational efficiency and financial health.

---

Average number of days

Based on the provided data for Vontier Corp, we can see the following trends in the activity ratios:

1. Days of Inventory on Hand (DOH): Vontier Corp's inventory management has fluctuated over the periods, with the number of days of inventory on hand varying. The company started with 44.32 days of inventory on hand as of December 31, 2021, and saw an increase to 175.00 days by June 30, 2024. This indicates a significant increase in the holding of inventory, which may suggest potential issues with inventory control and stocking levels.

2. Days of Sales Outstanding (DSO): Vontier Corp's accounts receivable collection period has also shown fluctuations. The DSO was at 71.40 days as of December 31, 2021, and ranged between 65.79 to 77.29 days until December 31, 2024. A consistent or decreasing trend in DSO is generally preferred as it indicates efficient collection of receivables. However, the variations in Vontier Corp's DSO may require further analysis to understand the reasons behind these fluctuations.

3. Number of Days of Payables: Vontier Corp's payables period has also experienced fluctuations. The number of days of payables ranged from 49.92 to 203.81 days from June 30, 2023, to September 30, 2024. A longer period of payables may suggest that the company is taking longer to pay its suppliers, which could be either a strategic decision or a sign of potential financial difficulties.

Overall, the analysis of Vontier Corp's activity ratios highlights the need for a closer examination of the company's inventory management, accounts receivable collection practices, and payment policies to ensure sustainability and efficiency in its operations.

---

Long-term

Long-term activity ratios, such as the Fixed Asset Turnover and Total Asset Turnover ratios, provide insights into how efficiently Vontier Corp is utilizing its assets to generate revenue.

The Fixed Asset Turnover ratio for Vontier Corp has shown a fluctuating trend over the analyzed period, ranging from a high of 35.99 in June 2022 to a low of 24.23 in September 2024. The ratio indicates that for every dollar invested in fixed assets, the company generated between 24.23 to 35.99 dollars in revenue during the respective periods.

On the other hand, the Total Asset Turnover ratio remained relatively stable, with values hovering around 0.72 to 0.76. This suggests that Vontier Corp is generating approximately 72 to 76 cents in revenue for every dollar of total assets it owns during the analyzed period.

Overall, while the Fixed Asset Turnover ratio has been more volatile, the Total Asset Turnover ratio indicates a consistent level of efficiency in utilizing both fixed and total assets to generate revenue over the period under review.