Cummins Inc (CMI)
Payables turnover
| Dec 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost of revenue (ttm) | US$ in thousands | 25,663,000 | 25,792,000 | 25,867,000 | 25,754,000 | 25,816,000 | 25,225,000 | 24,556,000 | 22,926,000 | 21,355,000 | 19,937,000 | 18,800,000 | 18,573,000 | 18,326,000 | 18,262,000 | 17,477,000 | 15,806,000 | 14,917,000 | 14,713,000 | 15,218,000 | 16,836,000 |
| Payables | US$ in thousands | 3,951,000 | 4,206,000 | 4,405,000 | 4,476,000 | 4,260,000 | 4,262,000 | 4,308,000 | 4,636,000 | 4,252,000 | 4,000,000 | 3,405,000 | 3,497,000 | 3,021,000 | 3,210,000 | 3,172,000 | 3,279,000 | 2,820,000 | 2,597,000 | 2,281,000 | 2,648,000 |
| Payables turnover | 6.50 | 6.13 | 5.87 | 5.75 | 6.06 | 5.92 | 5.70 | 4.95 | 5.02 | 4.98 | 5.52 | 5.31 | 6.07 | 5.69 | 5.51 | 4.82 | 5.29 | 5.67 | 6.67 | 6.36 |
December 31, 2024 calculation
Payables turnover = Cost of revenue (ttm) ÷ Payables
= $25,663,000K ÷ $3,951,000K
= 6.50
The payables turnover ratio for Cummins Inc over the past few years has shown some fluctuations. The ratio indicates how many times a company pays off its accounts payable within a specific period.
From March 31, 2020, to December 31, 2024, the payables turnover ranged from a low of 4.82 to a high of 6.67, with an average ratio of approximately 5.80. This suggests that, on average, Cummins Inc pays off its accounts payable approximately 5.8 times a year.
The trend in the payables turnover ratio demonstrates some volatility, with peaks and troughs observed throughout the period. For example, the ratio increased from 4.82 in March 31, 2021, to 6.07 in December 31, 2021, before decreasing to 4.95 in March 31, 2023. The ratio then experienced an upward trend, reaching 6.50 by December 31, 2024.
Overall, the payables turnover ratio for Cummins Inc indicates the efficiency with which the company manages its accounts payable. A higher ratio generally implies that the company is paying off its suppliers more quickly, while a lower ratio may suggest a longer payment cycle or potentially strained supplier relationships.
Peer comparison
Dec 31, 2024