WEC Energy Group Inc (WEC)

Short-term

Turnover ratios

Activity ratios provide insights into how efficiently a company manages its assets and liabilities to generate sales. Let's analyze the activity ratios of WEC Energy Group Inc based on the provided data:

1. Inventory Turnover:
- The inventory turnover ratio indicates how many times a company sells and replaces its inventory during a period.
- WEC Energy Group's inventory turnover has been relatively stable over the years, ranging from 5.92 to 8.36.
- A higher inventory turnover ratio indicates that the company is selling its inventory quickly, which can be a positive sign of efficient inventory management.

2. Receivables Turnover:
- The receivables turnover ratio measures how quickly a company collects payments from its customers.
- The data provided shows "N/A" for all years, indicating that specific information about receivables turnover is not available.
- Typically, a higher receivables turnover ratio signifies faster collection of receivables, which is favorable for cash flow management.

3. Payables Turnover:
- The payables turnover ratio evaluates how efficiently a company manages its accounts payable by comparing purchases to supplier credit terms.
- The data suggests that information on payables turnover is not provided for the specified years.
- A higher payables turnover ratio usually indicates that a company is paying its suppliers quickly, which can impact cash flow and relationships with suppliers.

4. Working Capital Turnover:
- The working capital turnover ratio measures how effectively a company utilizes its working capital to generate sales.
- The information for working capital turnover is not available for the given years.
- A higher working capital turnover ratio implies efficient utilization of working capital to support business operations and generate revenue.

In conclusion, based on the available data, WEC Energy Group Inc has demonstrated relatively stable inventory turnover, while information on receivables turnover, payables turnover, and working capital turnover is not provided for further analysis.

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Average number of days

The analysis of WEC Energy Group Inc's activity ratios reveals the following trends:

1. Days of Inventory on Hand (DOH):
- In the period from December 31, 2020, to December 31, 2024, WEC Energy Group Inc's DOH increased from 44.34 days to 61.66 days.
- The rising trend in DOH indicates that the company is holding inventory for a longer period before selling it, which could tie up working capital and increase holding costs.

2. Days of Sales Outstanding (DSO):
- The data provided does not include information on DSO for WEC Energy Group Inc for the years under review.
- Without DSO figures, it is challenging to assess how quickly the company collects its accounts receivable, impacting its cash flow and liquidity.

3. Number of Days of Payables:
- Similarly, data on the number of days of payables is not available for WEC Energy Group Inc across the specified years.
- The absence of this information makes it difficult to analyze how efficiently the company manages its payables and its cash conversion cycle.

In conclusion, while the analysis of WEC Energy Group Inc's DOH highlights a trend of increasing inventory holding period, the lack of data on DSO and payables days limits a comprehensive evaluation of the company's overall efficiency in managing its working capital and operating cycle.

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Long-term

WEC Energy Group Inc's long-term activity ratios provide insights into how effectively the company is utilizing its assets over time.

1. Fixed Asset Turnover:
- The fixed asset turnover ratio measures how efficiently the company is generating revenue from its fixed assets.
- WEC Energy Group's fixed asset turnover has shown a slight increase from 0.28 in 2020 to 0.33 in 2022, indicating a positive trend in utilizing fixed assets to generate revenue.
- However, the ratios for 2023 and 2024 are not available, potentially indicating a lack of data for those periods.

2. Total Asset Turnover:
- The total asset turnover ratio reflects the company's ability to generate sales from its total assets.
- WEC Energy Group's total asset turnover has fluctuated over the years, with a peak of 0.23 in 2022 and a decline to 0.18 in 2024.
- This decline may suggest a decrease in efficiency in utilizing total assets to generate revenue.

Overall, while the fixed asset turnover ratio has shown improvement, the total asset turnover ratio has displayed variability, potentially signaling the need for WEC Energy Group Inc to focus on optimizing the utilization of its assets to improve overall operational efficiency.