Hims Hers Health Inc (HIMS)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 157,051 | 118,194 | 67,384 | 39,307 | 37,953 |
| Payables | US$ in thousands | 43,070 | 32,363 | 19,640 | 8,066 | 18 |
| Payables turnover | 3.65 | 3.65 | 3.43 | 4.87 | 2,108.50 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $157,051K ÷ $43,070K
= 3.65
Payables turnover is a financial ratio that measures how efficiently a company is managing its trade credit. Hims Hers Health Inc's payables turnover over the past five years has been as follows:
- Dec 31, 2023: 3.65
- Dec 31, 2022: 3.65
- Dec 31, 2021: 3.43
- Dec 31, 2020: 4.87
- Dec 31, 2019: 2,108.50
The payables turnover ratio indicates how many times a company pays off its accounts payable in a given period. A higher ratio suggests that the company is managing its payables more efficiently, whereas a lower ratio may indicate that the company is taking longer to pay off its trade credit.
In the case of Hims Hers Health Inc, we observe fluctuations in the payables turnover ratio over the years. The ratio was significantly high in 2019, indicating that the company took a very long time to pay off its accounts payable that year. However, in subsequent years, the ratio improved, hovering around 3.43 to 4.87, suggesting that the company was able to manage its trade credit more efficiently.
Overall, based on the trend of payables turnover, Hims Hers Health Inc seems to have made improvements in managing its payables over the years, leading to more efficient use of trade credit.