Vital Energy Inc. (VTLE)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Inventory turnover | 43.58 | 71.56 | 32.29 | 379.11 | 177.31 |
| Receivables turnover | 4.98 | 7.51 | 5.03 | 8.68 | 7.58 |
| Payables turnover | — | — | — | — | — |
| Working capital turnover | — | — | — | — | 28.92 |
Inventory turnover for Vital Energy Inc. has fluctuated over the past five years, ranging from 32.29 to 379.11. A declining trend is observed from 2022 to 2023, indicating that the company is selling its inventory at a slower pace compared to the previous year. This may suggest potential issues with inventory management or inefficiencies in the sales process.
Receivables turnover has also shown variability, with figures ranging between 4.98 and 8.68. A lower turnover ratio implies that it takes longer for the company to collect on its credit sales. The decrease in 2023 compared to 2022 indicates that Vital Energy Inc. is collecting its receivables at a slower rate, which could impact cash flow and liquidity.
Unfortunately, the data does not provide information on payables turnover for Vital Energy Inc., preventing a comprehensive analysis of the company's management of its accounts payable. This missing data limits the ability to assess the efficiency of the company's payment of its suppliers.
Additionally, the working capital turnover rate is not available for any of the years listed, making it difficult to evaluate how effectively Vital Energy Inc. is utilizing its working capital to generate sales revenue. This ratio would have provided insight into the company's efficiency in utilizing its current assets to support its operations.
In conclusion, while the data on inventory turnover and receivables turnover provide some indication of Vital Energy Inc.'s operational efficiency and working capital management, the absence of payables turnover and working capital turnover data hinders a complete analysis of the company's activity ratios.
Average number of days
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 8.38 | 5.10 | 11.30 | 0.96 | 2.06 |
| Days of sales outstanding (DSO) | days | 73.23 | 48.61 | 72.63 | 42.03 | 48.16 |
| Number of days of payables | days | — | — | — | — | — |
Activity ratios measure how effectively a company manages its assets and liabilities to generate sales and cash flow. Looking at Vital Energy Inc.'s activity ratios over the past five years:
1. Days of Inventory on Hand (DOH):
- The DOH ratio shows how many days, on average, inventory is held before being sold.
- Vital Energy's inventory holding period has fluctuated significantly over the years, from a low of 0.96 days in 2020 to a high of 11.30 days in 2021.
- The sharp changes may indicate potential issues with inventory management, such as overstocking or underestimating demand.
2. Days of Sales Outstanding (DSO):
- DSO measures how long it takes for a company to collect its receivables.
- Vital Energy's DSO has also varied, with a high of 73.23 days in 2023 and a low of 42.03 days in 2020.
- Higher DSO values suggest slower collection of receivables, potentially impacting cash flow and liquidity.
3. Number of Days of Payables:
- Payables data is missing from the table, so we cannot analyze this aspect of Vital Energy's activity ratios.
- It would be helpful to know the company's payment terms with suppliers to assess how effectively it is managing its payables and optimizing working capital.
In summary, the analysis of Vital Energy Inc.'s activity ratios highlights fluctuations in inventory management and the collection of receivables over the past five years. Further insights could be gained by examining the company's payables data, if available.
Long-term
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 0.34 | 0.62 | 0.36 | 0.52 | 0.43 |
| Total asset turnover | 0.29 | 0.55 | 0.32 | 0.46 | 0.38 |
Vital Energy Inc.'s long-term activity ratios have shown fluctuating trends over the past five years. The fixed asset turnover ratio, which measures how efficiently the company generates sales from its fixed assets, has been on a declining trend from 0.43 in 2019 to 0.34 in 2023. This indicates that the company is generating fewer sales relative to its investment in fixed assets.
On the other hand, the total asset turnover ratio, which measures how effectively the company utilizes its total assets to generate revenue, has also shown a declining trend from 0.38 in 2019 to 0.29 in 2023. This suggests that Vital Energy Inc. is becoming less efficient in generating sales in relation to its total asset base.
Overall, the decreasing trend in both the fixed asset turnover and total asset turnover ratios may indicate potential inefficiencies in asset utilization and productivity within the company. It would be advisable for Vital Energy Inc. to further analyze and address the factors contributing to these declining ratios to improve its long-term operational efficiency and financial performance.