Victoria's Secret & Co (VSCO)

Short-term

Turnover ratios

Based on the provided data, we can analyze Victoria's Secret & Co activity ratios as follows:

1. Inventory Turnover:
- The inventory turnover ratio measures how efficiently the company manages its inventory. A higher ratio indicates that inventory is selling quickly.
- Victoria's Secret & Co's inventory turnover has fluctuated over the periods, ranging from a low of 2.97 to a high of 5.66. The trend seems to show some variability but generally indicates that inventory is being managed at a reasonable pace.

2. Receivables Turnover:
- The receivables turnover ratio indicates how quickly the company collects its accounts receivables. A higher ratio implies more efficient collection.
- Victoria's Secret & Co has provided inconsistent data for receivables turnover, with data missing for several periods. When data is available, the turnover is relatively high, indicating a quick collection cycle.

3. Payables Turnover:
- The payables turnover ratio reflects how quickly the company pays its suppliers. A higher ratio suggests more efficient management of payables.
- Victoria's Secret & Co's payables turnover has been inconsistent, with data missing for several periods. When data is available, the turnover ratios indicate a moderate pace of paying suppliers.

4. Working Capital Turnover:
- The working capital turnover ratio measures how effectively the company utilizes its working capital to generate sales. A higher ratio implies better utilization of resources.
- Victoria's Secret & Co's data for working capital turnover shows varying figures, with some periods having high turnover while others missing data. Overall, the company seems to be utilizing its working capital efficiently based on the available data.

In conclusion, Victoria's Secret & Co demonstrates mixed performance in its activity ratios, with some ratios showing efficiency and others lacking consistent data. Further analysis and comparison with industry benchmarks would provide a more comprehensive view of the company's operational efficiency.

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Average number of days

Based on the provided data for Victoria's Secret & Co, let's analyze the activity ratios:

1. Days of Inventory on Hand (DOH):
- The DOH represents the number of days it takes for a company to sell its entire inventory.
- Victoria's Secret & Co's DOH ranged from 64.46 days to 122.76 days over the period from January 31, 2022, to January 31, 2025.
- The trend shows some fluctuation, with a peak of 122.76 days in January 2023 and a decrease to 82.24 days by January 31, 2024.
- A lower DOH is generally preferred as it indicates faster inventory turnover, efficient management, and reduced risk of obsolescence.

2. Days of Sales Outstanding (DSO):
- DSO measures the average number of days it takes for a company to collect payment after a sale is made.
- Victoria's Secret & Co provided partial data for DSO, with values ranging from 6.84 days to 11.55 days.
- The DSO trend shows a decreasing pattern over time, which indicates an improvement in the speed of collecting payments from customers.
- A lower DSO is preferable as it shows effective credit management and liquidity.

3. Number of Days of Payables:
- This ratio reflects the average number of days a company takes to pay its suppliers.
- Victoria's Secret & Co didn't provide complete data for this ratio, with values ranging from 31.19 days to 56.13 days.
- The trend suggests fluctuations in the number of days of payables over the analyzed period.
- Generally, a higher number of days of payables may indicate a better cash flow position but could also strain supplier relationships if stretched too far.

In conclusion, Victoria's Secret & Co's activity ratios indicate fluctuations in its inventory management, collection efficiency, and payment practices over the period analyzed. Efforts to reduce inventory days and DSO while optimizing payment terms with suppliers could enhance the company's overall operational efficiency and cash flow management.

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Long-term

Victoria's Secret & Co's Fixed Asset Turnover ratio has shown fluctuations over the years, ranging from a high of 8.50 in July 2022 to a low of 2.44 in October 2023. This ratio measures how efficiently the company is utilizing its fixed assets to generate revenue, with higher values indicating better asset utilization. The trend in Fixed Asset Turnover suggests varying levels of efficiency in utilizing fixed assets for revenue generation.

On the other hand, the Total Asset Turnover ratio has also exhibited variability, with values ranging from 1.14 in October 2023 to 1.80 in July 2022. This ratio reflects the company's overall efficiency in generating sales from its total assets. A higher Total Asset Turnover indicates that the company is generating more revenue relative to its total assets.

Both ratios provide insights into Victoria's Secret & Co's operational efficiency and asset utilization. It is important for the company to monitor these ratios consistently to ensure optimal utilization of assets and sustainable revenue generation.