Embecta Corp (EMBC)

Working capital turnover

		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
Revenue (ttm)	US$ in thousands	1,117,100	1,113,300	1,126,900	1,116,800	1,115,200	1,110,600	1,115,600	1,108,100	1,123,300
Total current assets	US$ in thousands	761,000	781,100	710,000	719,500	749,100	787,500	756,300	761,700	664,700	580,600	426,500	258,300
Total current liabilities	US$ in thousands	374,000	370,700	310,400	326,600	353,500	385,800	357,700	370,300	301,000	228,500	168,900	159,100
Working capital turnover		2.89	2.71	2.82	2.84	2.82	2.76	2.80	2.83	3.09

September 30, 2024 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $1,117,100K ÷ ($761,000K – $374,000K)
= 2.89

The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate sales revenue. A higher working capital turnover ratio indicates that the company is effectively using its current assets to support its operations and sales.

Embecta Corp's working capital turnover ratio has been relatively stable over the past several quarters, ranging from 2.71 to 3.09. This indicates that the company has been consistently efficient in managing its working capital to generate sales.

A ratio above 1.0 generally indicates that the company is efficiently using its working capital to support its operations. Embecta Corp's ratios are well above 1.0, which is a positive sign.

It's worth noting that a working capital turnover ratio that is too high may suggest that the company is operating with a leaner level of working capital, which could potentially impact its ability to manage its short-term obligations or take advantage of growth opportunities.

Overall, based on the trend of Embecta Corp's working capital turnover ratio, the company appears to be effectively managing its working capital to support its sales operations. However, it would be important to monitor this ratio over time to ensure that the company maintains an optimal level of working capital efficiency.