Forward Air Corporation (FWRD)

Payables 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	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cost of revenue (ttm)	US$ in thousands	483,787	558,511	557,843	553,240	551,869	536,962	521,692	509,905	490,525	1,061,440	1,018,083	969,672	989,927	588,743	787,572	975,152	1,085,533	1,017,387	1,005,232	1,005,118
Payables	US$ in thousands	45,430	45,702	37,085	42,994	50,094	50,666	42,058	54,430	44,837	42,885	43,655	40,676	38,371	32,581	27,682	26,565	25,411	32,599	30,585	31,124
Payables turnover		10.65	12.22	15.04	12.87	11.02	10.60	12.40	9.37	10.94	24.75	23.32	23.84	25.80	18.07	28.45	36.71	42.72	31.21	32.87	32.29

December 31, 2023 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $483,787K ÷ $45,430K
= 10.65

The payables turnover ratio of Forward Air Corporation has shown some fluctuations over the past few quarters. The ratio measures how efficiently the company is managing its trade payables by comparing the amount of purchases to the average accounts payable for a period.

Looking at the trend, we can see that the payables turnover ratio has generally been on an upward trajectory since the beginning of 2020, with some periodic fluctuations. The ratio increased steadily from the first quarter of 2020 to the third quarter of 2020, reaching a peak in the third quarter of 2020 at 36.71, before slightly decreasing in the following quarters.

In more recent periods, the ratio has shown some variability, fluctuating between 9.37 in the first quarter of 2022 to 15.04 in the second quarter of 2023. This indicates that there have been changes in how efficiently the company is managing its trade payables during these periods.

Overall, a higher payables turnover ratio suggests that the company is efficiently managing its accounts payable and is paying off its suppliers more quickly. Conversely, a lower ratio may indicate that the company is taking longer to pay its suppliers, which could potentially strain relationships or indicate cash flow issues.

It is important for Forward Air Corporation to monitor its payables turnover ratio closely and ensure that it remains within industry norms while also considering the company's specific business needs and supplier relationships.