AGCO Corporation (AGCO)
Working capital turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 11,061,600 | 14,407,800 | 25,289,800 | 22,269,900 | 18,284,400 |
| Total current assets | US$ in thousands | 5,138,000 | 6,340,800 | 5,739,300 | 5,014,100 | 4,368,400 |
| Total current liabilities | US$ in thousands | 3,826,000 | 4,343,600 | 4,088,000 | 3,454,600 | 3,362,800 |
| Working capital turnover | 8.43 | 7.21 | 15.32 | 14.28 | 18.18 |
December 31, 2024 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $11,061,600K ÷ ($5,138,000K – $3,826,000K)
= 8.43
The working capital turnover ratio reflects how efficiently AGCO Corporation is utilizing its working capital to generate sales. A higher ratio indicates better efficiency in turning working capital into revenue.
From the data provided:
- In December 31, 2020, the working capital turnover was 18.18, indicating that for every dollar of working capital, the company generated $18.18 of sales.
- The ratio decreased to 14.28 in December 31, 2021, suggesting a reduction in the efficiency of working capital utilization.
- It increased slightly to 15.32 in December 31, 2022, showing a better utilization of working capital compared to the previous year.
- The ratio then dropped significantly to 7.21 in December 31, 2023, which may indicate potential issues with working capital management or a decrease in sales relative to working capital.
- In December 31, 2024, the ratio improved to 8.43, but still remained below the levels seen in 2020 and 2022.
Overall, the trend in AGCO Corporation's working capital turnover indicates fluctuations in the efficiency of utilizing working capital to generate sales over the years. It is important for the company to closely monitor this ratio to ensure optimal management of working capital for sustainable operations.
Peer comparison
Dec 31, 2024