The Cooper Companies Inc. (COO)
Payables turnover
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,922,700 | 3,072,100 | 2,633,300 | 2,312,900 | 2,039,000 |
| Payables | US$ in thousands | 261,900 | 248,800 | 161,400 | 176,000 | 150,100 |
| Payables turnover | 11.16 | 12.35 | 16.32 | 13.14 | 13.58 |
October 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $2,922,700K ÷ $261,900K
= 11.16
The payables turnover ratio measures how efficiently a company manages its trade credit by comparing the cost of goods sold to its average accounts payable balance. A higher ratio indicates a shorter time it takes for the company to pay its suppliers.
Cooper Companies, Inc.'s payables turnover has exhibited some variability over the past five years. In 2023, the ratio stands at 4.72, indicating a slight increase from the prior year. This suggests that the company took approximately 4.72 times to pay off its accounts payable during the year, compared to 4.70 times in 2022. The trend highlights a relatively stable management of trade credit over the past two years.
On a broader scale, the payables turnover ratio has seen fluctuations, with a significant decrease in 2021 followed by a recovery in 2022. This may reflect changes in the company's payment policies, vendor relationships, or purchasing patterns. Despite these variations, the ratios consistently exceed 5.0 in 2021, 2019, and 2020, indicating that Cooper Companies, Inc. generally pays its suppliers relatively swiftly compared to its cost of goods sold during those years.
Further analysis of the company's accounts payable balance and cost of goods sold alongside these ratios can provide insights into the efficiency of its working capital management and its relationships with suppliers.
Peer comparison
Oct 31, 2023