Badger Meter Inc (BMI)
Working capital turnover
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 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 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 706,241 | 671,125 | 631,849 | 592,988 | 565,654 | 554,078 | 534,685 | 519,723 | 505,169 | 481,750 | 466,659 | 434,884 | 425,526 | 420,753 | 415,700 | 428,070 | 424,345 | 421,202 | 422,957 | 433,148 |
| Total current assets | US$ in thousands | 442,177 | 422,952 | 388,587 | 360,843 | 347,832 | 325,628 | 303,921 | 281,277 | 261,360 | 245,692 | 219,313 | 204,112 | 223,688 | 232,750 | 223,407 | 211,429 | 200,094 | 191,541 | 175,544 | 171,223 |
| Total current liabilities | US$ in thousands | 131,948 | 128,782 | 118,914 | 115,786 | 110,312 | 101,785 | 97,335 | 88,509 | 82,146 | 79,835 | 72,309 | 71,766 | 68,036 | 60,192 | 62,701 | 60,456 | 57,247 | 58,845 | 54,307 | 57,924 |
| Working capital turnover | 2.28 | 2.28 | 2.34 | 2.42 | 2.38 | 2.48 | 2.59 | 2.70 | 2.82 | 2.90 | 3.17 | 3.29 | 2.73 | 2.44 | 2.59 | 2.84 | 2.97 | 3.17 | 3.49 | 3.82 |
December 31, 2023 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $706,241K ÷ ($442,177K – $131,948K)
= 2.28
The working capital turnover ratio for Badger Meter Inc. has exhibited a consistent trend of decrease over the past eight quarters, declining from 2.70 in Q1 2022 to 2.27 in both Q3 and Q4 of 2023. This indicates that the company is generating revenue at a slower rate relative to its working capital.
A working capital turnover ratio below 1 would suggest inefficiency in utilizing working capital to generate sales, while a ratio above 1 signifies that the company is effectively using its working capital to drive revenue. In this case, Badger Meter Inc. has consistently maintained a ratio above 2, indicating efficient utilization of working capital despite the downward trend.
While the declining trend may raise concerns about the company's ability to efficiently convert working capital into revenue, it is important to consider other factors affecting the ratio, such as seasonality, industry trends, and specific business strategies. Further analysis of the company's overall financial performance and liquidity position would provide more insights into the implications of the working capital turnover trend.
Peer comparison
Dec 31, 2023