Analysis of Short-term (Operating) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
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- Statement of Comprehensive Income
- Balance Sheet: Liabilities and Stockholders’ Equity
- Common-Size Income Statement
- Analysis of Liquidity Ratios
- Analysis of Long-term (Investment) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Dividend Discount Model (DDM)
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
- Price to Sales (P/S) since 2005
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Short-term Activity Ratios (Summary)
Texas Pacific Land Corp., short-term (operating) activity ratios
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
- Receivables Turnover
- The receivables turnover ratio demonstrates a fluctuating pattern over the analyzed period. Starting at 7.79 in 2019, it declined to a low of 4.74 in 2021, improved to 6.42 in 2022, and then decreased again to 4.9 in 2023. This indicates variability in the efficiency of the company’s collection of receivables, with the turnover generally trending downwards compared to the initial value.
- Payables Turnover
- The payables turnover ratio shows a relatively stable to slightly increasing trend. Beginning at 25.56 in 2019, it saw a dip in 2020 to 22.71, then gradually increased to 28.07 by 2023. This suggests that the company has been accelerating its payments to suppliers, with an increasing turnover rate indicating faster settlement of payables over time.
- Working Capital Turnover
- Working capital turnover ratio experienced an initial sharp decline from 1.43 in 2019 to 0.97 in 2020, followed by a slight decrease to 0.95 in 2021. The ratio then improved to 1.12 in 2022 but declined again to 0.77 in 2023. Overall, the trend reflects a decrease in the efficiency with which the company utilizes its working capital to generate sales, with notable volatility across the years.
- Average Receivable Collection Period
- The average receivable collection period has increased overall, indicating that the company takes longer to collect its receivables. It rose from 47 days in 2019 to a peak of 77 days in 2021, followed by a temporary reduction to 57 days in 2022, and then increased again to 75 days in 2023. The prolonged collection period may contribute to the observed decrease in receivables turnover.
- Average Payables Payment Period
- The average payables payment period has remained relatively stable, with minor fluctuations between 13 and 16 days throughout the period. It increased slightly from 14 days in 2019 to 16 days in 2020, then decreased back to 13 days by 2022 and remained at that level in 2023. This stability suggests consistent payment terms and practices with suppliers.
Turnover Ratios
Average No. Days
Receivables Turnover
Texas Pacific Land Corp., receivables turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenues | ||||||
| Accounts receivable and accrued receivables, net | ||||||
| Short-term Activity Ratio | ||||||
| Receivables turnover1 | ||||||
| Benchmarks | ||||||
| Receivables Turnover, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Receivables Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Receivables Turnover, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Receivables turnover = Revenues ÷ Accounts receivable and accrued receivables, net
= ÷ =
2 Click competitor name to see calculations.
- Revenues
- The revenue trend over the five-year period shows fluctuation with an initial decrease from approximately 490.5 million USD in 2019 to 302.6 million USD in 2020, representing a significant decline. This was followed by a recovery phase in the subsequent years, with revenues increasing to about 451.0 million USD in 2021 and peaking at 667.4 million USD in 2022. However, there was a slight decrease in 2023, where revenues declined to approximately 631.6 million USD. Overall, the revenue pattern indicates volatility, with a notable rebound after the 2020 downturn.
- Accounts Receivable and Accrued Receivables, Net
- The accounts receivable and accrued receivables demonstrate a consistent upward trend throughout the period. Starting at nearly 63.0 million USD in 2019, the balance decreased slightly in 2020 to about 48.2 million USD, mirroring the revenue drop in that year. From 2021 onward, there was a steady increase each year, reaching about 129.0 million USD by the end of 2023. This growth in receivables suggests an expanding amount of credit sales or slower collection processes over time.
- Receivables Turnover Ratio
- The receivables turnover ratio decreased from 7.79 in 2019 to 6.27 in 2020, indicating slower collection of receivables relative to sales. The ratio further declined to 4.74 in 2021, which may reflect increasing challenges in managing credit or longer payment terms granted to customers. A partial recovery occurred in 2022, where the ratio increased to 6.42, before declining again to 4.9 in 2023. The overall trend points to volatility with a general decrease compared to the base year, implying a potential weakening in receivables collection efficiency over the period.
Payables Turnover
Texas Pacific Land Corp., payables turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Revenues | ||||||
| Accounts payable and accrued expenses | ||||||
| Short-term Activity Ratio | ||||||
| Payables turnover1 | ||||||
| Benchmarks | ||||||
| Payables Turnover, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Payables Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Payables Turnover, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Payables turnover = Revenues ÷ Accounts payable and accrued expenses
= ÷ =
2 Click competitor name to see calculations.
The financial data reveals several notable trends in the company's operations over the five-year period ending December 31, 2023.
- Revenues
- The revenue figures demonstrate volatility with a downward trend in 2020 followed by a recovery and growth in the subsequent years. Specifically, revenues declined significantly from approximately $490.5 million in 2019 to around $302.6 million in 2020, a decrease of nearly 38%. This was followed by an increase to about $451.0 million in 2021, continuing upward to reach $667.4 million in 2022, representing the highest level in the period. However, there was a slight decline to $631.6 million in 2023. Overall, despite fluctuation, revenues have shown resilience and growth after the initial drop in 2020.
- Accounts Payable and Accrued Expenses
- The accounts payable and accrued expenses exhibit a fluctuating trend as well. These liabilities decreased from roughly $19.2 million in 2019 to $13.3 million in 2020, indicating a reduction in short-term obligations during that year. Followingly, they increased progressively over the next three years, reaching approximately $23.9 million in 2022 and slightly declining to $22.5 million in 2023. This pattern may reflect changing payment terms, purchasing activity, or operational scale changes aligned with the revenue trends.
- Payables Turnover Ratio
- The payables turnover ratio, which indicates the number of times payables are paid during a period, shows a modest downward movement in 2020 from 25.56 times in 2019 to 22.71 times, potentially reflecting longer payment cycles or slower turnover in that year. It then improves steadily to 25.18 in 2021, 27.93 in 2022, and marginally higher at 28.07 in 2023. The increasing ratio after 2020 suggests an improvement in the company's efficiency in managing its payables, possibly paying suppliers more frequently or accelerating cash outflows as the business activities increased.
In summary, the company experienced a considerable revenue decline in 2020, which was followed by robust growth. Simultaneously, accounts payable and accrued expenses first contracted then expanded in tandem with revenue movements, while the payables turnover ratio declined in 2020 and subsequently improved, indicating enhanced management of payables in the last three years.
Working Capital Turnover
Texas Pacific Land Corp., working capital turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Current assets | ||||||
| Less: Current liabilities | ||||||
| Working capital | ||||||
| Revenues | ||||||
| Short-term Activity Ratio | ||||||
| Working capital turnover1 | ||||||
| Benchmarks | ||||||
| Working Capital Turnover, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Working Capital Turnover, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Working Capital Turnover, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Working capital turnover = Revenues ÷ Working capital
= ÷ =
2 Click competitor name to see calculations.
- Working Capital
- Working capital shows a consistent upward trend over the five-year period, increasing from $342,176 thousand in 2019 to $818,077 thousand in 2023. This represents more than a doubling of the working capital base, indicating a strengthening liquidity position and possibly an accumulation of current assets relative to current liabilities.
- Revenues
- Revenues experienced fluctuations throughout the period. There is a significant decline from $490,496 thousand in 2019 to $302,554 thousand in 2020, followed by a recovery to $450,958 thousand in 2021 and further growth to a peak of $667,422 thousand in 2022. However, in 2023, revenues declined moderately to $631,595 thousand. Overall, the revenue pattern reflects volatility with an upward momentum after the dip in 2020.
- Working Capital Turnover Ratio
- The working capital turnover ratio exhibits a general downward trend from 1.43 in 2019 to 0.77 in 2023, with minor fluctuations. This ratio declines sharply from 1.43 to 0.97 in 2020, then slightly decreases to 0.95 in 2021, improves to 1.12 in 2022, but falls again to 0.77 in 2023. This downward trend suggests that the company is generating less revenue per unit of working capital over time, which may indicate a lower efficiency in using its working capital to support sales.
- Summary of Insights
- The data indicates that while the company has steadily increased its working capital, this increase has not consistently translated into proportional revenue growth, especially notable in the declining working capital turnover ratio. The initial revenue drop in 2020 aligns with the global economic disruptions during that period, followed by a strong rebound and peak in 2022. The moderate revenue decline in 2023, combined with rising working capital and decreased turnover ratio, may suggest challenges in optimizing asset utilization or managing operational efficiency. The overall pattern highlights a need to assess the effectiveness of working capital management in supporting sustainable revenue growth.
Average Receivable Collection Period
Texas Pacific Land Corp., average receivable collection period calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Receivables turnover | ||||||
| Short-term Activity Ratio (no. days) | ||||||
| Average receivable collection period1 | ||||||
| Benchmarks (no. days) | ||||||
| Average Receivable Collection Period, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Average Receivable Collection Period, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Average Receivable Collection Period, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ =
2 Click competitor name to see calculations.
The analysis of the receivables turnover and average receivable collection period over the five-year span reveals fluctuating patterns in the management of accounts receivable.
- Receivables Turnover
- The receivables turnover ratio decreased from 7.79 in 2019 to 4.74 in 2021, indicating a slowdown in the frequency at which receivables were collected during this period. There was a partial recovery to 6.42 in 2022, followed by a decline again to 4.9 in 2023. The general trend suggests challenges in maintaining consistent collection efficiency.
- Average Receivable Collection Period
- The average receivable collection period lengthened significantly from 47 days in 2019 to 77 days by 2021, reflecting an increase in the time required to collect receivables. This improvement somewhat reversed in 2022, with the period reducing to 57 days, but then increased again to 75 days in 2023. These fluctuations correspond inversely to the receivables turnover trends.
Overall, the data demonstrate variability in receivables management, with intermittent improvements and declines in collection efficiency. The longer collection periods in recent years may suggest potential liquidity challenges or changes in credit policies, warranting further investigation.
Average Payables Payment Period
Texas Pacific Land Corp., average payables payment period calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Payables turnover | ||||||
| Short-term Activity Ratio (no. days) | ||||||
| Average payables payment period1 | ||||||
| Benchmarks (no. days) | ||||||
| Average Payables Payment Period, Competitors2 | ||||||
| Chevron Corp. | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Average Payables Payment Period, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Average Payables Payment Period, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ =
2 Click competitor name to see calculations.
The financial data reveals notable trends in the management of payables over the five-year period ending in 2023. The payables turnover ratio demonstrates a generally positive trajectory, indicating an improvement in the speed at which obligations to suppliers are settled.
- Payables Turnover
- The payables turnover ratio decreased from 25.56 in 2019 to 22.71 in 2020, suggesting a slower payment pace during that year. However, from 2020 onwards, there was a consistent increase: rising to 25.18 in 2021, 27.93 in 2022, and slightly improving further to 28.07 in 2023. This upward trend may reflect stronger liquidity or more efficient payables management, as the company is able to clear its payables more rapidly over time.
- Average Payables Payment Period
- The average payment period in days stayed relatively stable but shows a slight improvement. It increased from 14 days in 2019 to 16 days in 2020, aligning with the dip observed in turnover that same year, potentially indicating extended payment terms or slower payments. After 2020, the payment period decreased to 14 days in 2021 and then further shortened to 13 days in 2022 and remained steady at 13 days in 2023. This reduction aligns with the rising payables turnover, confirming an acceleration in fulfilling payment obligations.
Overall, the data suggests that after a temporary slowdown in payables settlement during 2020, the company improved its payment efficiency significantly from 2021 onward. The shorter payment period coupled with increased turnover may indicate enhanced operational cash flow management or stronger negotiating positions with suppliers. This trend points toward a more agile and financially disciplined approach in managing trade payables.