Cabot Corporation (CBT)
Working capital turnover
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 3,994,000 | 3,958,000 | 3,910,000 | 3,924,000 | 3,931,000 | 4,078,000 | 4,259,000 | 4,318,000 | 4,321,000 | 4,113,000 | 3,881,000 | 3,631,000 | 3,409,000 | 3,164,000 | 2,765,000 | 2,633,000 | 2,614,000 | 2,782,000 | 3,109,000 | 3,243,000 |
| Total current assets | US$ in thousands | 1,605,000 | 1,591,000 | 1,605,000 | 1,692,000 | 1,626,000 | 1,602,000 | 1,742,000 | 1,800,000 | 1,820,000 | 1,871,000 | 1,778,000 | 1,609,000 | 1,425,000 | 1,370,000 | 1,224,000 | 1,125,000 | 978,000 | 983,000 | 1,171,000 | 1,196,000 |
| Total current liabilities | US$ in thousands | 772,000 | 717,000 | 718,000 | 830,000 | 822,000 | 738,000 | 904,000 | 984,000 | 1,105,000 | 1,100,000 | 1,407,000 | 1,327,000 | 1,147,000 | 704,000 | 647,000 | 570,000 | 529,000 | 494,000 | 563,000 | 574,000 |
| Working capital turnover | 4.79 | 4.53 | 4.41 | 4.55 | 4.89 | 4.72 | 5.08 | 5.29 | 6.04 | 5.33 | 10.46 | 12.88 | 12.26 | 4.75 | 4.79 | 4.74 | 5.82 | 5.69 | 5.11 | 5.21 |
September 30, 2024 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $3,994,000K ÷ ($1,605,000K – $772,000K)
= 4.79
The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate revenue. A higher ratio indicates that the company is efficiently managing its working capital, while a lower ratio may signify inefficiencies.
In analyzing Cabot Corporation's working capital turnover over the past few quarters, we observe some fluctuations. The ratio has varied between 4.41 and 12.88, with significant peaks and troughs seen in certain periods.
In the most recent quarter, ending September 30, 2024, Cabot Corporation had a working capital turnover of 4.79, which indicates that for every dollar of working capital, Cabot generated $4.79 in revenue during the quarter. This suggests a reasonably efficient use of working capital.
Looking back at historical data, we can see that the working capital turnover has generally been trending upwards since the end of 2021, reaching its peak at 12.88 in the first quarter of 2022. This significant spike may indicate a period of exceptionally efficient working capital management or a sudden increase in revenue generation relative to the working capital levels.
It is essential to consider the reasons behind such fluctuations in the working capital turnover ratio. Factors such as changes in sales volume, inventory management, accounts receivable, and accounts payable practices can all impact this ratio. Further analysis of the company's financial statements and industry benchmarks would provide more insight into the dynamics driving these fluctuations in Cabot Corporation's working capital turnover.
Peer comparison
Sep 30, 2024