Wyndham Hotels & Resorts Inc (WH)

Short-term

Turnover ratios

Based on the provided data, let's analyze the activity ratios of Wyndham Hotels & Resorts Inc:

1. Inventory Turnover:
- In 2021, the inventory turnover ratio was 5.34, indicating that the company's inventory was sold and replaced approximately 5.34 times during the year.

2. Receivables Turnover:
- The receivables turnover ratio shows how many times the company collected its accounts receivable during the year.
- It improved from 4.41 in 2020 to 6.36 in 2021, suggesting that Wyndham Hotels & Resorts Inc was able to collect payments from its customers more efficiently in 2021.

3. Payables Turnover:
- The payables turnover ratio measures how quickly a company pays its suppliers.
- The ratio declined from 18.25 in 2020 to 9.65 in 2021, indicating that the company took longer to pay its suppliers in 2021 compared to 2020.

4. Working Capital Turnover:
- The working capital turnover ratio reflects how effectively the company utilizes its working capital to generate sales.
- In 2021, the ratio significantly improved to 4.85 from 2.35 in 2020, showing a more efficient utilization of working capital to drive revenue.

Overall, the analysis of activity ratios suggests that Wyndham Hotels & Resorts Inc improved its inventory management, accounts receivable collection, and working capital utilization in 2021. However, there was a decrease in payables turnover, indicating a slower payment cycle to suppliers. Monitoring these ratios can provide insights into the efficiency and effectiveness of the company's operational activities.

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Average number of days

Wyndham Hotels & Resorts Inc's activity ratios provide insights into how efficiently the company manages its inventory, collects receivables, and pays its suppliers.

1. Days of Inventory on Hand (DOH):
- As of December 31, 2021, Wyndham Hotels & Resorts Inc had inventory on hand for approximately 68.36 days. This indicates the average number of days it takes for the company to sell its inventory. A lower DOH is generally favorable as it suggests efficient inventory turnover.

2. Days of Sales Outstanding (DSO):
- The Days of Sales Outstanding for Wyndham Hotels & Resorts Inc decreased from 82.83 days in 2020 to 57.37 days in 2021. This ratio represents the average collection period for receivables, with a lower DSO indicating faster collection of cash from credit sales.

3. Number of Days of Payables:
- The Number of Days of Payables for Wyndham Hotels & Resorts Inc increased from 20.00 days in 2020 to 37.84 days in 2021. This ratio reflects the average number of days the company takes to pay its suppliers. A longer payable period may indicate better cash flow management but could also signal strained supplier relations.

In summary, Wyndham Hotels & Resorts Inc improved its efficiency in managing inventory and collecting receivables between 2020 and 2021 while also extending its payable period to suppliers. Keeping an eye on these activity ratios can help investors and stakeholders assess the company's operational effectiveness and financial health.

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Long-term

The fixed asset turnover ratio measures how efficiently a company utilizes its fixed assets to generate revenue. In the case of Wyndham Hotels & Resorts Inc, the fixed asset turnover ratio has shown a significant improvement over the years.

Starting at 4.68 in December 31, 2020, the ratio has increased to 14.76 in December 31, 2021, and continued to rise to 15.13 in December 31, 2022. It peaked at 15.88 in December 31, 2023 before slightly declining to 14.98 by the end of December 31, 2024.

This upward trend indicates that Wyndham Hotels & Resorts Inc has been able to generate more revenue relative to its investment in fixed assets. It suggests that the company is efficiently utilizing its property, plant, and equipment to drive sales and operations.

Additionally, the total asset turnover ratio measures how efficiently a company utilizes all its assets to generate revenue. For Wyndham Hotels & Resorts Inc, the total asset turnover ratio has been relatively stable over the years.

Starting at 0.28 in December 31, 2020, the ratio increased to 0.37 in December 31, 2021, but then decreased to 0.36 in December 31, 2022, and further to 0.35 in December 31, 2023. It saw a slight decline to 0.33 by the end of December 31, 2024.

Although the total asset turnover ratio showed some fluctuations, it generally remained within a close range. This indicates that the company has been able to maintain a consistent level of revenue generated per dollar of total assets employed.

Overall, the analysis of the long-term activity ratios for Wyndham Hotels & Resorts Inc suggests that the company has shown significant improvement in efficiently utilizing its fixed assets to generate revenue, while maintaining a stable performance in terms of total asset turnover.