Howmet Aerospace Inc (HWM)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 6,422,000 | 5,433,000 | 4,565,000 | 4,881,000 | 13,875,000 |
| Total current assets | US$ in thousands | 3,316,000 | 3,143,000 | 2,737,000 | 3,672,000 | 5,843,000 |
| Total current liabilities | US$ in thousands | 1,784,000 | 1,482,000 | 1,253,000 | 1,660,000 | 4,125,000 |
| Working capital turnover | 4.19 | 3.27 | 3.08 | 2.43 | 8.08 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $6,422,000K ÷ ($3,316,000K – $1,784,000K)
= 4.19
The working capital turnover ratio for Howmet Aerospace Inc has shown variability over the past five years. The ratio has ranged from a low of 2.61 in 2020 to a high of 8.27 in 2019. This ratio measures the efficiency with which the company is able to generate sales using its working capital.
A higher working capital turnover ratio generally indicates that the company is effectively utilizing its working capital to generate sales. In contrast, a lower ratio may suggest inefficiency in managing working capital or challenges in converting working capital into sales.
The trend in Howmet Aerospace Inc's working capital turnover ratio shows improvement over the years, with a notable increase from 2.61 in 2020 to 4.33 in 2023. This signifies enhanced efficiency in utilizing working capital to support sales growth.
Overall, the increasing trend in the working capital turnover ratio for Howmet Aerospace Inc reflects better management of working capital and a more efficient utilization of resources to drive sales.
Peer comparison
Dec 31, 2023