CarGurus (CARG)
Fixed asset turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 916,367 | 1,656,550 | 951,443 | 551,428 | 589,606 |
| Property, plant and equipment | US$ in thousands | 83,370 | 40,128 | 32,210 | 27,483 | 27,950 |
| Fixed asset turnover | 10.99 | 41.28 | 29.54 | 20.06 | 21.10 |
December 31, 2023 calculation
Fixed asset turnover = Revenue ÷ Property, plant and equipment
= $916,367K ÷ $83,370K
= 10.99
The fixed asset turnover ratio for CarGurus Inc has shown fluctuations over the past five years. In 2023, the ratio stands at 10.97, which indicates that CarGurus generated $10.97 in sales for every dollar invested in fixed assets. This represents a significant decrease from the exceptionally high ratio of 41.24 in 2022. The substantial drop in 2023 could be attributed to factors such as changes in the company's asset base, sales volume, or a combination of both.
Comparing the 2023 ratio to the ratios in the preceding years, it is evident that CarGurus has historically been able to effectively utilize its fixed assets to generate revenue, with ratios ranging from 20.07 to 29.54 in the years 2020 to 2022. The relatively lower ratio in 2019 at 21.07 may indicate a shift in the efficiency of fixed asset utilization compared to the subsequent years.
Overall, while the significant decline in fixed asset turnover in 2023 raises a point of concern, further analysis of the company's financial performance and operational efficiency is recommended to understand the underlying reasons for this fluctuation and to determine the sustainability of the trend in the future.
Peer comparison
Dec 31, 2023