Walmart Inc (WMT)
Activity ratios
Short-term
Turnover ratios
| Jan 31, 2024 | Jan 31, 2023 | Jan 31, 2022 | Jan 31, 2021 | Jan 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | 8.93 | 8.20 | 7.59 | 9.35 | 8.88 |
| Receivables turnover | 73.68 | 77.06 | 69.17 | 85.81 | 83.38 |
| Payables turnover | 8.63 | 8.63 | 7.76 | 8.55 | 8.40 |
| Working capital turnover | — | — | — | — | — |
Inventory turnover measures how many times a company's inventory is sold and replaced within a given period. Walmart Inc's inventory turnover has been relatively stable over the past five years, ranging from 7.59 to 9.35 times per year. This indicates that Walmart efficiently manages its inventory levels, with a higher turnover generally viewed positively as it reflects faster sales cycles.
Receivables turnover indicates how efficiently a company collects its accounts receivable. Walmart Inc's receivables turnover has fluctuated but remained at healthy levels, ranging from 69.17 to 85.81 times per year over the past five years. A higher turnover ratio suggests that Walmart collects its receivables quickly, which is a positive sign of strong cash flow management.
Payables turnover measures how effectively a company manages its accounts payable. Walmart Inc's payables turnover has been relatively consistent, ranging from 7.76 to 8.63 times per year over the past five years. This implies that Walmart is able to pay its suppliers in a timely manner without holding onto payables for an extended period, which can enhance relationships with suppliers.
Working capital turnover ratio is not provided in the data table. This ratio typically indicates how effectively a company is generating revenue from its working capital. As such, without this data, we cannot assess Walmart Inc's efficiency in utilizing its working capital to generate sales.
Overall, based on the activity ratios provided, Walmart Inc appears to effectively manage its inventory, accounts receivable, and accounts payable, indicating efficient operational performance and cash flow management.
Average number of days
| Jan 31, 2024 | Jan 31, 2023 | Jan 31, 2022 | Jan 31, 2021 | Jan 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 40.88 | 44.53 | 48.08 | 39.03 | 41.10 |
| Days of sales outstanding (DSO) | days | 4.95 | 4.74 | 5.28 | 4.25 | 4.38 |
| Number of days of payables | days | 42.31 | 42.30 | 47.02 | 42.67 | 43.45 |
Days of inventory on hand (DOH) measures how long, on average, it takes for Walmart to sell its inventory. A lower DOH indicates the company is efficient in managing its inventory. Walmart's DOH has shown a decreasing trend over the past five years, from 41.10 days in 2020 to 40.88 days in 2024, suggesting improvements in inventory management efficiency.
Days of sales outstanding (DSO) represents the average number of days it takes for Walmart to collect its accounts receivable. A lower DSO indicates the company collects payments faster. Walmart's DSO has shown some fluctuation over the years but has generally remained stable, with a slight increase from 4.25 days in 2021 to 4.95 days in 2024.
Number of days of payables indicates how long Walmart takes to pay its suppliers. A longer payment period can indicate better cash flow management. Walmart's number of days of payables has been relatively stable over the years, ranging from 42.30 days in 2023 to 47.02 days in 2022.
Overall, Walmart has shown improvements in its inventory management efficiency over the years, with a decreasing trend in DOH. The stability in DSO and payables days indicates a consistent approach to managing receivables and payables. These ratios collectively suggest that Walmart has been effective in optimizing its working capital management practices.
See also:
Walmart Inc Short-term (Operating) Activity Ratios
Long-term
| Jan 31, 2024 | Jan 31, 2023 | Jan 31, 2022 | Jan 31, 2021 | Jan 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 5.85 | 6.07 | 6.06 | 6.06 | 4.98 |
| Total asset turnover | 2.57 | 2.51 | 2.34 | 2.21 | 2.22 |
The fixed asset turnover ratio indicates Walmart's efficiency in generating sales revenue from its investment in fixed assets over the past five years. The ratio has fluctuated between 4.98 and 6.07 during this period, with the highest value observed in 2023. This suggests that Walmart has been fairly effective in utilizing its fixed assets to generate revenue, although there have been slight fluctuations over time.
On the other hand, the total asset turnover ratio reflects Walmart's ability to generate sales relative to its total assets. The ratio has shown a general upward trend over the past five years, increasing from 2.22 in 2020 to 2.57 in 2024. This indicates that Walmart has become more efficient in utilizing its total assets to generate sales revenue, which is a positive indicator of the company's operational efficiency and asset management.
Overall, the upward trend in the total asset turnover ratio coupled with relatively stable fixed asset turnover ratios suggests that Walmart has been efficient in utilizing both its fixed and total assets to drive sales growth over the past five years.