Embecta Corp (EMBC)
Receivables turnover
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 | ||
---|---|---|---|---|---|---|---|---|---|---|
Revenue (ttm) | US$ in thousands | 1,116,800 | 1,115,200 | 1,110,600 | 1,115,600 | 1,108,100 | 1,123,300 | |||
Receivables | US$ in thousands | 206,400 | 159,100 | 190,100 | 152,700 | 143,300 | 133,100 | 119,200 | 15,200 | 118,300 |
Receivables turnover | 5.41 | 7.01 | 5.84 | 7.31 | 7.73 | 8.44 |
December 31, 2023 calculation
Receivables turnover = Revenue (ttm) ÷ Receivables
= $1,116,800K ÷ $206,400K
= 5.41
The receivables turnover ratio measures how efficiently a company is collecting its accounts receivable during a specific period. A higher ratio indicates that the company is collecting its outstanding receivables more quickly.
Analyzing the data provided for Embecta Corp, we observe fluctuations in the receivables turnover ratio over the past few quarters. In general, a higher receivables turnover ratio is preferred as it signifies a more efficient collection process.
Looking at the trend, we see that the receivables turnover ratio has been declining from a peak of 8.44 in the third quarter of 2022 to 5.41 in the most recent quarter, December 31, 2023. This decline may indicate that the company is taking longer to collect its accounts receivable, which could potentially impact cash flow and liquidity.
It is essential for Embecta Corp to closely monitor and manage its accounts receivable collection process to ensure optimal cash flow and financial health. Further analysis of the reasons behind the decreasing trend in receivables turnover is warranted to address any underlying issues and improve overall efficiency in collections.
Peer comparison
Dec 31, 2023