American Eagle Outfitters Inc (AEO)

Working capital turnover

		Feb 3, 2024	Oct 28, 2023	Jul 29, 2023	Apr 29, 2023	Jan 28, 2023	Oct 29, 2022	Jul 30, 2022	Apr 30, 2022	Jan 29, 2022	Oct 30, 2021	Jul 31, 2021	Jan 30, 2021	Oct 31, 2020	Aug 1, 2020	May 2, 2020	Feb 1, 2020	Nov 2, 2019	Aug 3, 2019	May 4, 2019	Feb 2, 2019
Revenue (ttm)	US$ in thousands	5,261,780	5,139,060	5,078,580	5,015,720	4,989,830	4,941,580	4,975,080	5,031,220	5,268,470	4,792,150	4,401,580	3,759,112	3,781,452	3,816,242	3,973,612	4,308,210	4,237,780	4,175,080	4,099,053	4,035,724
Total current assets	US$ in thousands	1,433,350	1,353,420	1,201,490	1,129,500	1,100,240	1,277,100	1,177,390	1,280,540	1,396,920	1,775,530	1,601,580	1,522,640	1,507,790	1,582,370	1,558,940	1,047,930	1,078,570	1,020,070	950,603	1,046,250
Total current liabilities	US$ in thousands	891,172	831,231	762,476	716,437	768,948	685,430	718,061	737,479	842,871	869,572	769,218	858,482	894,336	840,414	662,227	751,756	810,152	763,646	649,797	542,645
Working capital turnover		9.70	9.84	11.57	12.14	15.06	8.35	10.83	9.26	9.51	5.29	5.29	5.66	6.16	5.14	4.43	14.55	15.79	16.28	13.63	8.01

February 3, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $5,261,780K ÷ ($1,433,350K – $891,172K)
= 9.70

The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate sales revenue. A higher ratio indicates that the company is effectively managing its working capital.

Analyzing the working capital turnover of American Eagle Outfitters Inc over the past few quarters, we can observe fluctuations in the ratio. In the most recent quarter, the company's working capital turnover was 9.70. This suggests that for every dollar of working capital invested, American Eagle Outfitters generated $9.70 in sales revenue.

The trend in the working capital turnover ratio shows an increase from 8.01 in February 2019 to a peak of 16.28 in November 2019, indicating improved efficiency in utilizing working capital to drive sales during that period. Subsequently, the ratio fluctuated but has generally maintained at relatively high levels, reflecting strong management of working capital.

Overall, American Eagle Outfitters Inc has demonstrated a consistent ability to efficiently utilize its working capital to generate sales revenue, with occasional fluctuations in the ratio over the analyzed periods. As such, the company appears to have strong financial management practices in place.