Wynn Resorts Limited (WYNN)

Short-term

Turnover ratios

Activity ratios measure how efficiently a company manages its assets to generate revenue. Looking at the activity ratios of Wynn Resorts Ltd. over the past five years, we can observe the following trends:

1. Inventory Turnover:
- The inventory turnover ratio has shown a fluctuating trend over the years, with a significant increase from 2020 to 2021, followed by a slight decrease in 2022 and another increase in 2023.
- This indicates that Wynn Resorts has been effectively managing its inventory levels to drive sales, with a notable improvement in 2021 and 2023.

2. Receivables Turnover:
- The receivables turnover ratio has also shown variability, with a notable increase in 2023 compared to the previous years.
- This implies that the company has been efficient in collecting payments from customers, especially in the most recent year.

3. Payables Turnover:
- The payables turnover ratio has been relatively stable over the years, indicating a consistent payment cycle for the company.
- The increase in 2023 compared to 2022 suggests that Wynn Resorts might be extending its payment terms with suppliers.

4. Working Capital Turnover:
- The working capital turnover ratio has shown a fluctuating trend over the years, with a significant decrease in 2022 followed by a notable recovery in 2023.
- This ratio indicates how efficiently the company is using its working capital to generate sales, with the sharp improvement in 2023 reflecting better utilization of resources.

In summary, Wynn Resorts Ltd. has demonstrated varying levels of efficiency in managing its inventory, receivables, payables, and working capital over the past five years. The company's ability to improve these activity ratios in certain years suggests a concerted effort to enhance operational efficiency and optimize its asset management practices.

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Average number of days

Activity ratios provide insight into how efficiently a company is managing its assets and liabilities. Let's analyze Wynn Resorts Ltd.'s activity ratios based on the provided data:

1. Days of Inventory on Hand (DOH):
- The DOH measures how many days, on average, the company holds onto its inventory before selling it. A lower DOH indicates that the company is efficiently managing its inventory.
- Wynn Resorts Ltd.'s DOH has fluctuated over the years, decreasing from 13.88 days in 2020 to 7.44 days in 2023. This suggests that the company is now holding less inventory before selling it, which could indicate improved inventory management efficiency.

2. Days of Sales Outstanding (DSO):
- The DSO ratio indicates the average number of days it takes for the company to collect payment from its customers. A lower DSO implies quicker collection of receivables, which is beneficial for cash flow.
- Wynn Resorts Ltd.'s DSO has also varied, with a significant increase from 2019 to 2020 and a subsequent decrease by 2023. The decrease in DSO over time suggests that the company is collecting payments from customers more efficiently.

3. Number of Days of Payables:
- This ratio reflects the average number of days it takes for the company to pay its suppliers or vendors. A higher number of days indicates that the company is taking longer to pay its bills.
- Wynn Resorts Ltd.'s days of payables have fluctuated, with peaks in 2019 and 2022. However, the number of days of payables decreased to 20.52 days in 2023. This decrease may indicate that the company is managing its payables more efficiently or negotiating better payment terms with its suppliers.

In summary, based on the activity ratios analysis:
- Wynn Resorts Ltd. has improved its inventory management efficiency by reducing its days of inventory on hand.
- The company has also enhanced its accounts receivable management as reflected in the decrease in days of sales outstanding.
- Moreover, Wynn Resorts Ltd. has shown some improvement in managing its payables based on the reduction in the number of days of payables in 2023.

These improvements in activity ratios suggest that Wynn Resorts Ltd. may be operating more efficiently and effectively managing its working capital.

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Long-term

Wynn Resorts Ltd.'s long-term activity ratios have displayed fluctuations over the past five years. The fixed asset turnover ratio, which measures how efficiently the company is utilizing its fixed assets to generate revenue, has shown inconsistent trends. In 2023, the fixed asset turnover ratio improved to 0.98 from 0.54 in 2022, indicating a more efficient use of fixed assets to generate sales. However, it is important to note that in 2021 and 2020, the ratio was relatively low, suggesting a less effective utilization of fixed assets during those years.

On the other hand, the total asset turnover ratio, which reflects the company's ability to generate sales from its total assets, has also depicted variability. In 2023, the total asset turnover ratio increased to 0.47 from 0.28 in 2022, showcasing an enhanced efficiency in generating revenue from its total assets. Conversely, in 2021 and 2020, the total asset turnover ratio was relatively lower, indicating a weaker performance in utilizing total assets to generate sales during those years.

Overall, the improvement in both the fixed asset turnover and total asset turnover ratios in 2023 compared to the previous years suggests a potential positive shift towards better long-term asset utilization efficiency for Wynn Resorts Ltd. However, it is essential for the company to maintain and sustain these improvements to ensure consistent and effective utilization of its assets for revenue generation in the future.