Fastenal Company (FAST)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 7,340,200 | 6,965,200 | 6,002,300 | 5,639,000 | 5,321,000 |
| Total current assets | US$ in thousands | 3,020,900 | 3,124,800 | 2,856,600 | 2,499,600 | 2,457,200 |
| Total current liabilities | US$ in thousands | 661,300 | 789,800 | 682,200 | 612,700 | 544,700 |
| Working capital turnover | 3.11 | 2.98 | 2.76 | 2.99 | 2.78 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $7,340,200K ÷ ($3,020,900K – $661,300K)
= 3.11
Fastenal Co. experienced fluctuations in its working capital turnover ratio over the past five years. The working capital turnover ratio measures how efficiently a company utilizes its working capital to generate sales. A higher ratio indicates that the company is able to efficiently convert its working capital into revenue.
In 2023, Fastenal Co. achieved a working capital turnover of 3.11, signifying an improvement from the previous year. This suggests that the company was able to generate $3.11 in sales for every dollar of working capital invested. The increase in efficiency indicates better management of working capital resources to support sales growth.
In 2022, the working capital turnover was slightly lower at 2.99 compared to 2023 but consistent with the ratio recorded in 2020. This indicates that Fastenal Co. maintained a relatively stable level of efficiency in converting working capital into sales during these years.
In 2021, the company's working capital turnover ratio was 2.76, showing a decrease from the previous year. This suggests that Fastenal Co. was less efficient in utilizing its working capital to drive sales during that period.
In 2019, the working capital turnover ratio was 2.79, similar to 2020, indicating consistent efficiency in utilizing working capital to generate revenue.
Overall, the trend in Fastenal Co.'s working capital turnover ratio shows fluctuations over the five-year period, with some years demonstrating improvements in efficiency while others experienced slight declines. Further analysis of the company's working capital management practices and sales strategies may provide insights into the factors influencing these fluctuations.
Peer comparison
Dec 31, 2023