Now Inc (DNOW)
Receivables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 2,319,000 | 2,133,000 | 1,632,000 | 1,620,000 | 2,950,000 |
| Receivables | US$ in thousands | 384,000 | 398,000 | 304,000 | 198,000 | 370,000 |
| Receivables turnover | 6.04 | 5.36 | 5.37 | 8.18 | 7.97 |
December 31, 2023 calculation
Receivables turnover = Revenue ÷ Receivables
= $2,319,000K ÷ $384,000K
= 6.04
The receivables turnover ratio of NOW Inc has shown some fluctuation over the past five years. The ratio increased from 7.98 in 2019 to 8.18 in 2020, indicating that the company's ability to collect accounts receivables improved during that period. However, there was a noticeable drop in the ratio to 5.37 in 2021, which was sustained in 2022 as well. This decline suggests that NOW Inc took longer to collect receivables in those years compared to the previous ones.
In 2023, the receivables turnover ratio increased to 6.04, showing a slight improvement in the company's efficiency in collecting outstanding receivables compared to the previous two years. Overall, the trend in the receivables turnover ratio indicates that NOW Inc may have experienced some challenges in managing its accounts receivables effectively in recent years, which could impact its cash flow and working capital management. Further analysis of the company's credit policies and collection procedures may be warranted to address these fluctuations.
Peer comparison
Dec 31, 2023