Globus Medical (GMED)

Working capital 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
Revenue (ttm)	US$ in thousands	1,568,476	1,226,440	1,096,949	1,068,982	1,022,843	998,366	973,939	961,307	958,102	941,526	927,903	825,809	789,042	767,264	747,381	792,998	785,368	769,639	742,660	721,505
Total current assets	US$ in thousands	1,915,370	1,917,340	1,210,010	1,070,430	983,344	920,001	891,168	916,598	864,516	980,514	891,998	814,373	821,765	811,951	696,891	641,800	687,468	637,063	583,933	617,568
Total current liabilities	US$ in thousands	392,347	428,722	155,220	167,547	159,204	145,255	146,017	141,491	140,164	122,525	130,042	123,677	120,792	99,980	106,126	97,962	111,403	94,921	84,184	79,492
Working capital turnover		1.03	0.82	1.04	1.18	1.24	1.29	1.31	1.24	1.32	1.10	1.22	1.20	1.13	1.08	1.27	1.46	1.36	1.42	1.49	1.34

December 31, 2023 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $1,568,476K ÷ ($1,915,370K – $392,347K)
= 1.03

The working capital turnover ratio measures how efficiently a company is utilizing its working capital to generate sales. It is calculated by dividing net sales by average working capital. A higher ratio indicates better efficiency in utilizing working capital.

Analyzing the working capital turnover ratios of Globus Medical Inc over the past eight quarters, we observe some fluctuations in the ratio. In Q4 2023, the ratio stands at 1.03, which indicates that the company generated $1.03 in revenue for every dollar of working capital invested during the quarter. This figure is lower compared to the previous quarter but higher than in Q3 and Q2 of 2023.

The downward trend from Q1 to Q3 2023 might suggest that the company's efficiency in utilizing working capital to generate sales temporarily decreased. However, the ratio improved in Q4 2023 compared to the preceding quarters.

Looking at the trend over the past year, the working capital turnover ratio has shown some variability, with peaks in Q2 and Q3 of 2022. This could reflect changes in the company's operational efficiency and how effectively it manages its working capital to support revenue generation.

Overall, the working capital turnover ratios of Globus Medical Inc indicate fluctuations in the efficiency of utilizing working capital to drive sales, with the most recent quarter showing a slight improvement compared to the preceding quarters. Further analysis of the company's working capital management practices and operational performance may provide additional insights into these fluctuations.