CarGurus (CARG)

Payables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	735,630	1,422,950	699,810	368,969	488,395
Payables	US$ in thousands	47,854	32,529	66,153	21,563	36,731
Payables turnover		15.37	43.74	10.58	17.11	13.30

December 31, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $735,630K ÷ $47,854K
= 15.37

CarGurus Inc's payables turnover ratio has exhibited significant fluctuations over the past five years. The ratio stood at 5.49 in 2023, reflecting a decrease from the exceptionally high turnover of 30.66 in 2022 but an improvement compared to the relatively lower turnover in 2021 and preceding years.

The payables turnover ratio indicates how efficiently a company is managing its payables by measuring the number of times a company pays off its average accounts payable balance during a specific period. A higher turnover ratio is generally preferable as it suggests that the company is efficiently managing its payables by paying suppliers promptly.

The significant fluctuations in CarGurus Inc's payables turnover ratio may suggest variations in the company's payment terms with suppliers, changes in purchasing or operating strategies, or fluctuations in the overall business environment. Further analysis of the underlying factors influencing these fluctuations would be necessary to provide a more in-depth understanding of the company's payables management strategy and financial performance.