WESCO International Inc (WCC)
Activity ratios
Short-term
Turnover ratios
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 5.87 | 5.93 | 5.80 | 5.50 | 5.71 | 5.57 | 5.97 | 6.30 | 6.53 | 6.28 | 6.16 | 5.38 | 4.62 | 3.54 | 2.85 | 7.14 | 6.70 | 6.95 | 6.88 | 7.17 |
| Receivables turnover | 3.98 | 5.92 | 5.78 | 5.78 | 3.80 | 5.72 | 5.50 | 5.82 | 3.96 | 5.92 | 5.95 | 5.59 | 3.37 | 4.13 | 3.38 | 6.89 | 4.87 | 6.29 | 6.04 | 6.42 |
| Payables turnover | 8.63 | 7.92 | 7.80 | 7.74 | 7.32 | 7.54 | 7.12 | 7.76 | 8.14 | 7.19 | 6.84 | 6.30 | 5.86 | 4.56 | 4.06 | 8.44 | 8.16 | 7.87 | 7.96 | 8.25 |
| Working capital turnover | 4.47 | 4.53 | 4.45 | 4.48 | 4.75 | 4.79 | 4.98 | 5.29 | 5.52 | 5.68 | 6.28 | 5.05 | 4.89 | 3.37 | 2.65 | 4.82 | 5.74 | 5.61 | 5.61 | 5.97 |
Wesco International, Inc.'s activity ratios, based on the provided data, indicate how efficiently the company is managing its resources.
1. Inventory Turnover: The company's inventory turnover has ranged between 4.61 and 4.96 over the past eight quarters. This suggests that Wesco International is effectively managing its inventory levels and converting its inventory into sales efficiently.
2. Receivables Turnover: The receivables turnover ratios have also been consistent, fluctuating between 5.16 and 5.50. This implies that the company is efficiently collecting revenue from its customers and managing its accounts receivables effectively.
3. Payables Turnover: Wesco International's payables turnover has varied between 6.14 and 7.21 over the same period. A higher payables turnover indicates that the company is taking longer to pay its suppliers, which can be beneficial for cash flow management.
4. Working Capital Turnover: The working capital turnover ratios have shown a declining trend, moving from 5.28 to 4.47. This could indicate that Wesco International is becoming less efficient in generating sales relative to its working capital.
Overall, Wesco International, Inc.'s activity ratios reflect a strong management of inventory and receivables, although there may be some room for improvement in working capital turnover. The company's payables turnover suggests a favorable cash flow management strategy.
Average number of days
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 62.15 | 61.56 | 62.96 | 66.37 | 63.91 | 65.54 | 61.17 | 57.92 | 55.88 | 58.11 | 59.30 | 67.89 | 78.99 | 103.04 | 128.23 | 51.09 | 54.48 | 52.49 | 53.03 | 50.89 |
| Days of sales outstanding (DSO) | days | 91.64 | 61.64 | 63.11 | 63.14 | 95.99 | 63.80 | 66.34 | 62.69 | 92.19 | 61.67 | 61.36 | 65.27 | 108.27 | 88.35 | 107.89 | 52.98 | 74.96 | 58.03 | 60.41 | 56.86 |
| Number of days of payables | days | 42.30 | 46.06 | 46.77 | 47.13 | 49.83 | 48.42 | 51.24 | 47.07 | 44.86 | 50.80 | 53.36 | 57.96 | 62.33 | 80.02 | 89.86 | 43.23 | 44.73 | 46.36 | 45.88 | 44.22 |
Activity ratios such as Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and Number of Days of Payables provide insights into how efficiently Wesco International, Inc. manages its inventory, accounts receivable, and accounts payable.
1. Days of Inventory on Hand (DOH):
- Wesco International's DOH has ranged from 69.75 to 79.19 days over the past eight quarters.
- In general, the company holds inventory for around 70 to 80 days before selling it.
- The decreasing trend in DOH from Q1 2023 to Q4 2023 suggests that the company may be managing its inventory more efficiently in recent quarters.
2. Days of Sales Outstanding (DSO):
- Wesco International's DSO has fluctuated between 66.36 and 73.50 days over the same period.
- The company takes approximately 66 to 74 days to collect payment from its customers on credit sales.
- The slight decrease in DSO from Q2 2022 to Q4 2023 indicates that the company may be improving its collection process or credit policies.
3. Number of Days of Payables:
- Wesco International's number of days of payables has varied from 50.59 to 61.50 days in the past eight quarters.
- On average, the company takes around 50 to 60 days to settle its accounts payable.
- The fluctuating trend in payables days may indicate changes in the company's payment terms with its suppliers or its working capital management strategies.
In summary, the analysis of Wesco International's activity ratios shows that the company has been making efforts to optimize its inventory, accounts receivable, and accounts payable management over the quarters, which can positively impact its overall operational efficiency and cash flow.
Long-term
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Fixed asset turnover | 52.85 | 54.66 | 54.15 | 54.74 | 53.19 | 55.69 | 54.00 | 50.76 | 48.09 | 47.31 | 44.00 | 36.80 | 30.88 | 25.73 | 20.60 | 45.47 | 46.07 | 47.41 | 47.52 | 48.86 |
| Total asset turnover | 1.49 | 1.48 | 1.47 | 1.47 | 1.45 | 1.47 | 1.44 | 1.45 | 1.44 | 1.40 | 1.37 | 1.21 | 1.04 | 0.87 | 0.71 | 1.60 | 1.67 | 1.64 | 1.62 | 1.63 |
Wesco International, Inc.'s long-term activity ratios indicate the efficiency with which the company is utilizing its fixed assets and total assets to generate revenue. The fixed asset turnover ratio has been relatively stable, ranging from 50.74 to 55.67 over the past eight quarters, with the highest turnover recorded in Q3 2022. This ratio measures the company's ability to generate sales from its investment in fixed assets, such as property, plant, and equipment.
In contrast, the total asset turnover ratio has also remained relatively consistent, fluctuating between 1.44 and 1.49 during the same period. This ratio reflects Wesco International, Inc.'s effectiveness in generating revenue based on its total assets, including both fixed and current assets. A high total asset turnover ratio indicates efficient utilization of all assets to generate sales.
Overall, the stable trend in both fixed asset turnover and total asset turnover ratios suggests that Wesco International, Inc. is effectively managing its assets to drive revenue growth. An analyst would monitor these ratios over time to assess the company's operational efficiency and asset utilization strategies.