Dover Corporation (DOV)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 8,306,830 | 8,391,830 | 7,800,760 | 6,577,040 | 7,136,400 |
| Total current assets | US$ in thousands | 3,390,240 | 3,423,460 | 3,061,710 | 2,619,190 | 2,548,430 |
| Total current liabilities | US$ in thousands | 2,413,770 | 2,773,270 | 2,250,340 | 1,738,800 | 1,748,090 |
| Working capital turnover | 8.51 | 12.91 | 9.61 | 7.47 | 8.92 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $8,306,830K ÷ ($3,390,240K – $2,413,770K)
= 8.51
The working capital turnover ratio measures how efficiently a company utilizes its working capital to generate sales revenue. A higher ratio indicates better efficiency in managing working capital.
Based on the data provided for Dover Corp. from 2019 to 2023, the working capital turnover ratio has shown some fluctuations. In 2019, the ratio was 8.94, indicating that for every $1 of working capital, Dover generated $8.94 in sales revenue.
The ratio increased in 2020 to 7.59, suggesting an improvement in the efficiency of working capital utilization. However, it then jumped significantly in 2021 to 9.75, indicating a notable increase in sales generated per unit of working capital.
In 2022, the ratio further improved to 13.09, reflecting a substantial increase in efficiency in working capital management. This spike may suggest aggressive management of working capital or optimized operational processes.
In 2023, the working capital turnover ratio decreased to 8.64, but still remained relatively high compared to previous years. This could be a sign of a shift in the company's working capital management strategy or changes in sales volumes.
Overall, the trend in Dover Corp.'s working capital turnover ratio indicates varying levels of efficiency in utilizing working capital over the years, with notable improvements in 2021 and 2022. Further analysis would be needed to understand the factors driving these fluctuations and their implications for the company's financial performance and operations.
Peer comparison
Dec 31, 2023