PC Connection Inc (CNXN)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 2,850,070 | 3,124,980 | 2,892,630 | 2,590,160 | 2,819,820 |
| Total current assets | US$ in thousands | 1,048,640 | 953,792 | 932,413 | 858,980 | 776,411 |
| Total current liabilities | US$ in thousands | 327,965 | 310,517 | 374,632 | 342,260 | 308,923 |
| Working capital turnover | 3.95 | 4.86 | 5.19 | 5.01 | 6.03 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $2,850,070K ÷ ($1,048,640K – $327,965K)
= 3.95
PC Connection Inc's working capital turnover has shown a decreasing trend over the past five years. The ratio decreased from 6.03 in 2019 to 3.95 in 2023. This indicates that the company's efficiency in utilizing its working capital to generate sales has declined over the period. A lower working capital turnover may suggest that the company is holding excess inventory, carrying too many receivables, or not managing its working capital efficiently.
The decrease in working capital turnover could indicate potential issues with inventory management, accounts receivable collection, or overall working capital management within the company. It may be worth investigating further to understand the specific factors contributing to the declining trend and take necessary actions to improve working capital efficiency.
Overall, a declining trend in working capital turnover may indicate a need for PC Connection Inc to review and optimize its working capital management practices to enhance operational efficiency and financial performance.
Peer comparison
Dec 31, 2023