Dril-Quip Inc (DRQ)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 308,503 | 265,935 | 242,356 | 269,698 | 295,007 |
| Payables | US$ in thousands | 65,696 | 43,019 | 35,232 | 37,424 | 46,324 |
| Payables turnover | 4.70 | 6.18 | 6.88 | 7.21 | 6.37 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $308,503K ÷ $65,696K
= 4.70
Dril-Quip, Inc.'s payables turnover ratio has fluctuated over the past five years, indicating the company's efficiency in managing its accounts payable. The ratio decreased from 6.37 in 2019 to 6.18 in 2022, before further declining to 4.70 in 2023.
A decreasing trend in the payables turnover ratio suggests that the company is taking longer to pay its suppliers, which may indicate potential cash flow challenges or strained supplier relationships. It could also imply issues regarding procurement or inventory management.
Although a lower payables turnover ratio may indicate a potential liquidity concern, it is essential to consider other financial metrics and factors within the company's operations to assess its overall financial health accurately. Further analysis and comparison with industry benchmarks would provide a more comprehensive understanding of Dril-Quip, Inc.'s accounts payable management efficiency.
Peer comparison
Dec 31, 2023