CarGurus (CARG)

Payables 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
Cost of revenue (ttm)	US$ in thousands	735,621	752,705	959,405	1,231,130	1,422,954	1,468,675	1,257,385	952,693	699,810	526,449	453,296	365,796	370,338	282,803	323,621	375,723	355,471	351,782	234,146	123,891
Payables	US$ in thousands	47,854	37,481	39,260	42,701	32,529	67,149	74,171	61,873	66,153	55,340	45,877	36,293	21,563	16,839	10,438	29,839	36,731	42,752	39,370	35,253
Payables turnover		15.37	20.08	24.44	28.83	43.74	21.87	16.95	15.40	10.58	9.51	9.88	10.08	17.17	16.79	31.00	12.59	9.68	8.23	5.95	3.51

December 31, 2023 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $735,621K ÷ $47,854K
= 15.37

CarGurus Inc's payables turnover ratio has fluctuated over the past eight quarters. The company's payables turnover ratio indicates how efficiently it is managing its trade payables.

In Q1 2022, the payables turnover ratio was 8.38, indicating that CarGurus Inc was able to convert its accounts payable into cash 8.38 times during the quarter. The ratio increased to 10.67 in the following quarter and continued to rise to 15.00 in Q3 2022. This suggests that the company was improving its efficiency in paying off its suppliers promptly.

However, there was a significant jump in efficiency in Q4 2022, with the payables turnover ratio reaching 30.66. This could be due to various factors such as renegotiating payment terms with suppliers or better cash flow management.

Subsequently, in Q1 2023, the payables turnover ratio decreased to 19.34, still indicating a strong ability to manage payables efficiently. The ratio further declined to 14.72 in Q2 2023 and then to 9.54 in Q3 2023.

Overall, the trend in CarGurus Inc's payables turnover ratio shows fluctuations but generally indicates a strong ability to manage its trade payables effectively. It is essential for the company to continue monitoring this ratio to ensure that it maintains efficient payment practices and good relationships with suppliers.