Allegro Microsystems Inc (ALGM)

Payables turnover

		Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 23, 2022	Sep 23, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020
Cost of revenue (ttm)	US$ in thousands	675,181	654,212	598,808	564,316	568,633	556,778	557,723	559,700	516,370	508,871	542,957	488,290
Payables	US$ in thousands	35,964	37,633	62,603	65,382	56,256	49,945	40,620	34,492	29,836	34,189	29,158	34,704	35,389	20,262	—
Payables turnover		18.77	17.38	9.57	8.63	10.11	11.15	13.73	16.23	17.31	14.88	18.62	14.07

March 31, 2024 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $675,181K ÷ $35,964K
= 18.77

Based on the payables turnover ratios provided for Allegro Microsystems Inc from September 2020 to March 2024, it can be observed that there have been fluctuations in the efficiency of the company in managing its accounts payable.

The payables turnover ratio indicates the number of times a company pays off its accounts payable during a specific period. A higher payables turnover ratio generally suggests that the company is paying off its suppliers more frequently, which could be a positive sign of good financial health and strong supplier relationships.

Looking at the trend over the last few quarters, there appears to be some volatility in Allegro Microsystems Inc's payables turnover ratio. The ratio has fluctuated between 8.63 and 18.77 during this period, showing inconsistency in how quickly the company is settling its payables.

In the most recent period, the payables turnover ratio of 18.77 indicates that the company paid off its suppliers approximately 18.77 times during the quarter. This is a significant increase from the previous quarters and may suggest a more aggressive approach to managing payables or improved supplier terms.

Overall, while a high payables turnover ratio can be a positive indicator of efficient cash management and strong supplier relationships, investors and analysts should consider other factors and trends in conjunction with this ratio to gain a comprehensive understanding of Allegro Microsystems Inc's financial performance and operational efficiency.