Guess? Inc. (GES)
Payables turnover
| Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 30, 2021 | Oct 31, 2020 | Aug 1, 2020 | May 2, 2020 | Feb 1, 2020 | Nov 2, 2019 | Aug 3, 2019 | May 4, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost of revenue (ttm) | US$ in thousands | 2,514,849 | 2,483,710 | 2,466,635 | 2,454,446 | 2,441,425 | 2,156,257 | 1,926,975 | 1,671,381 | 1,422,126 | 1,364,578 | 1,344,876 | 1,261,849 | 1,179,427 | 1,310,957 | 1,367,638 | 1,533,681 | 1,662,401 | 1,689,776 | 1,688,595 | 1,677,481 |
| Payables | US$ in thousands | 272,830 | 292,443 | 308,614 | 274,683 | 289,442 | 322,967 | 340,943 | 288,070 | 325,797 | 313,727 | 285,578 | 257,926 | 300,427 | 293,109 | 259,743 | 214,937 | 232,761 | 253,593 | 246,492 | 206,738 |
| Payables turnover | 9.22 | 8.49 | 7.99 | 8.94 | 8.43 | 6.68 | 5.65 | 5.80 | 4.37 | 4.35 | 4.71 | 4.89 | 3.93 | 4.47 | 5.27 | 7.14 | 7.14 | 6.66 | 6.85 | 8.11 |
February 3, 2024 calculation
Payables turnover = Cost of revenue (ttm) ÷ Payables
= $2,514,849K ÷ $272,830K
= 9.22
The payables turnover ratio is a financial metric that helps assess how efficiently a company manages its trade credit or accounts payable. A higher payables turnover ratio generally indicates that a company is paying off its suppliers more frequently, which may suggest either favorable credit terms negotiated with suppliers or efficient working capital management.
Analyzing the payables turnover ratio for Guess? Inc. over the past few quarters, we can see some fluctuations. The ratio ranged from a low of 3.93 to a high of 9.22 over the period. The company's payables turnover ratio peaked at 9.22 in February 3, 2024, indicating that Guess? Inc. was able to pay off its suppliers almost 9.22 times during that period.
However, it's important to note that a very high payables turnover ratio could also suggest that a company may be stretching its payables too thin, potentially straining relationships with suppliers. On the other hand, a low payables turnover ratio may suggest that a company is not utilizing its trade credit efficiently or may be facing liquidity issues.
Overall, while a higher payables turnover ratio is generally preferred, it is crucial to consider the broader financial context and industry norms when interpreting this ratio.