CarGurus (CARG)

Working capital 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
Total current assets	US$ in thousands	391,191	557,366	563,108	331,976	218,954
Total current liabilities	US$ in thousands	115,178	98,733	170,709	66,536	73,758
Working capital turnover		3.32	3.61	2.42	2.08	4.06

December 31, 2023 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $916,367K ÷ ($391,191K – $115,178K)
= 3.32

CarGurus Inc's working capital turnover has exhibited fluctuations over the past five years, ranging from a low of 2.08 in 2020 to a peak of 4.06 in 2019. The trend indicates variability in the company's efficiency in generating revenue relative to its working capital. In 2023, the working capital turnover decreased to 3.31 from 3.61 in 2022, suggesting a potential decline in the company's ability to efficiently utilize its working capital to generate sales. Despite the year-over-year decrease, the current turnover ratio remains relatively healthy compared to previous years. This metric indicates the number of times CarGurus Inc can convert its working capital into revenue, highlighting the effectiveness of the company in managing its operating cycle. Further analysis and comparison with industry benchmarks could provide additional insights into the company's liquidity management and operational efficiency.