Hormel Foods Corporation (HRL)
Working capital turnover
| Jan 31, 2025 | Oct 31, 2024 | Oct 27, 2024 | Jul 31, 2024 | Jul 28, 2024 | Apr 30, 2024 | Apr 28, 2024 | Jan 31, 2024 | Jan 28, 2024 | Oct 31, 2023 | Oct 29, 2023 | Jul 31, 2023 | Jul 30, 2023 | Apr 30, 2023 | Jan 31, 2023 | Jan 29, 2023 | Oct 31, 2022 | Oct 30, 2022 | Jul 31, 2022 | May 1, 2022 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 12,163,430 | 12,073,060 | 11,822,320 | 11,549,900 | 11,648,370 | 11,728,510 | 12,039,240 | 12,352,980 | 12,319,370 | 12,285,720 | 12,065,280 | 11,856,860 | 11,848,700 | 12,187,250 | 12,473,890 | 12,537,310 | 12,664,070 | 12,477,150 | 12,257,230 | 12,250,940 |
| Total current assets | US$ in thousands | 3,266,070 | 3,246,480 | 3,246,480 | 2,997,450 | 2,997,450 | 3,976,520 | 3,976,520 | 3,367,160 | 3,367,160 | 3,297,250 | 3,297,250 | 3,254,770 | 3,254,770 | 3,162,600 | 3,195,310 | 3,195,310 | 3,637,120 | 3,637,120 | 3,403,480 | 3,373,560 |
| Total current liabilities | US$ in thousands | 1,331,810 | 1,399,300 | 1,399,300 | 1,309,750 | 1,309,750 | 2,304,810 | 2,304,810 | 2,260,780 | 2,260,780 | 2,311,780 | 2,311,780 | 2,320,620 | 2,320,620 | 1,305,220 | 1,373,380 | 1,373,380 | 1,473,270 | 1,473,270 | 1,419,900 | 1,480,660 |
| Working capital turnover | 6.29 | 6.54 | 6.40 | 6.84 | 6.90 | 7.02 | 7.20 | 11.17 | 11.13 | 12.47 | 12.24 | 12.69 | 12.68 | 6.56 | 6.85 | 6.88 | 5.85 | 5.77 | 6.18 | 6.47 |
January 31, 2025 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $12,163,430K ÷ ($3,266,070K – $1,331,810K)
= 6.29
The working capital turnover for Hormel Foods Corporation has shown some fluctuations over the period from May 1, 2022, to January 31, 2025. The working capital turnover ratio measures how efficiently the company is utilizing its working capital to generate revenue.
Initially, the working capital turnover was at a relatively high level of around 6.5 times, indicating that the company was effectively using its working capital to support its operations. The ratio then increased significantly to over 12 times by July 30, 2023, and continued at a similar level until January 31, 2024. This sharp rise may suggest that the company improved its management of working capital or experienced a surge in revenue generation.
However, from April 28, 2024, the working capital turnover started to decline gradually, reaching around 6.3 times by January 31, 2025. The decreasing trend could indicate a decrease in sales relative to the working capital invested in the business or inefficient use of working capital during that period.
Overall, the working capital turnover ratio for Hormel Foods Corporation fluctuated during the period under review. Investors and analysts may want to further investigate the reasons behind these fluctuations to understand the company's working capital management and its impact on revenue generation.