HealthStream Inc (HSTM)

Working capital turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Revenue	US$ in thousands	291,646	279,063	266,826	256,712	244,826
Total current assets	US$ in thousands	153,122	130,210	114,377	106,845	114,725
Total current liabilities	US$ in thousands	115,693	118,361	117,213	100,350	119,442
Working capital turnover		7.79	23.55	—	39.52	—

December 31, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $291,646K ÷ ($153,122K – $115,693K)
= 7.79

The working capital turnover ratio for HealthStream Inc shows a fluctuating trend over the years. In 2021, the ratio was relatively high at 39.52, indicating that the company efficiently utilized its working capital to generate revenue. However, in 2023, the ratio declined to 23.55, suggesting a decrease in the company's ability to generate revenue from its working capital.

Furthermore, in 2024, the working capital turnover dropped significantly to 7.79, signaling a potential issue with managing working capital efficiently to generate sales. This decreasing trend in the ratio may indicate a need for the company to reassess its working capital management strategies to improve operational efficiency and maximize revenue generation.