Chuy's Holdings Inc (CHUY)

Payables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	300,360	281,303	253,010	230,707	307,395
Payables	US$ in thousands	5,561	8,059	4,127	2,977	4,253
Payables turnover		54.01	34.91	61.31	77.50	72.28

December 31, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $300,360K ÷ $5,561K
= 54.01

The payables turnover ratio indicates how efficiently Chuy`s Holdings Inc is managing its accounts payable by measuring how many times the company pays off its suppliers within a given period. A higher payables turnover ratio implies that the company is paying its suppliers more frequently.

Looking at the trend over the past five years, we observe fluctuations in Chuy`s payables turnover ratio. In 2023, the payables turnover ratio increased to 20.84 from 14.26 in 2022, indicating an improvement in the efficiency of managing payables. However, it was lower than the ratios in 2021, 2020, and 2019.

Despite the increase in 2023, it is important to note that a very high payables turnover ratio could signify that the company may be delaying payments to suppliers excessively, which could strain supplier relationships.

Chuy`s Holdings Inc should carefully assess its payables turnover ratio and strive to strike a balance between managing working capital efficiently and maintaining healthy relationships with suppliers.