Cognizant Technology Solutions Corp Class A (CTSH)
Receivables 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 19,736,000 | 19,412,000 | 19,265,000 | 19,301,000 | 19,353,000 | 19,434,000 | 19,394,000 | 19,414,000 | 19,428,000 | 19,366,000 | 19,253,000 | 18,932,000 | 18,507,000 | 17,914,000 | 17,413,000 | 16,828,000 | 16,652,000 | 16,752,000 | 16,757,000 | 16,898,000 |
| Receivables | US$ in thousands | 4,059,000 | 4,206,000 | 3,973,000 | 3,822,000 | 3,849,000 | 3,807,000 | 3,755,000 | 3,718,000 | 3,796,000 | 3,686,000 | 3,785,000 | 3,663,000 | 3,557,000 | 3,510,000 | 3,419,000 | 3,232,000 | 3,087,000 | 3,118,000 | 3,208,000 | 3,220,000 |
| Receivables turnover | 4.86 | 4.62 | 4.85 | 5.05 | 5.03 | 5.10 | 5.16 | 5.22 | 5.12 | 5.25 | 5.09 | 5.17 | 5.20 | 5.10 | 5.09 | 5.21 | 5.39 | 5.37 | 5.22 | 5.25 |
December 31, 2024 calculation
Receivables turnover = Revenue (ttm) ÷ Receivables
= $19,736,000K ÷ $4,059,000K
= 4.86
The receivables turnover ratio of Cognizant Technology Solutions Corp Class A has been relatively stable over the past few years, ranging between 4.62 to 5.39. This ratio measures the company's ability to efficiently collect cash from its credit customers. A higher turnover ratio is generally preferred as it indicates that the company is collecting its accounts receivable more quickly.
During the period under review, the receivables turnover ratio peaked at 5.39 on December 31, 2020, suggesting efficient collection practices. However, the ratio showed a decreasing trend in the subsequent quarters, reaching its lowest point of 4.62 on September 30, 2024. This decline may indicate potential issues with collecting receivables promptly or changes in the company's customer credit policies.
It is important for Cognizant Technology Solutions Corp Class A to monitor its receivables turnover ratio closely and implement strategies to maintain a healthy balance between efficient collections and maintaining strong customer relationships. Overall, the stability of the ratio within a certain range indicates a consistent approach to managing accounts receivable.
Peer comparison
Dec 31, 2024