Ingersoll Rand Inc (IR)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 6,876,100 | 5,916,300 | 5,152,400 | 3,973,200 | 2,017,500 |
| Total current assets | US$ in thousands | 4,050,400 | 3,967,300 | 4,114,900 | 3,862,100 | 1,543,900 |
| Total current liabilities | US$ in thousands | 1,827,300 | 1,674,000 | 1,467,700 | 1,498,600 | 574,600 |
| Working capital turnover | 3.09 | 2.58 | 1.95 | 1.68 | 2.08 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $6,876,100K ÷ ($4,050,400K – $1,827,300K)
= 3.09
In analyzing Ingersoll-Rand Inc's working capital turnover over the past five years, we can observe a fluctuating trend. The working capital turnover ratio measures how efficiently a company utilizes its working capital to generate sales revenue.
In 2023, the working capital turnover ratio improved to 3.09, indicating that the company generated $3.09 in sales for every dollar of working capital invested. This significant increase from the previous year suggests that Ingersoll-Rand effectively managed its working capital to support increased sales activity.
For the year 2022, the ratio stood at 2.58, showing a slight decline from the prior year but still at a relatively healthy level. In 2021, the ratio was 1.95, which indicates that the company generated $1.95 in sales for every dollar of working capital. This suggests a potential inefficiency in managing working capital during that period.
In 2020, the working capital turnover ratio improved to 2.08, signaling a better utilization of working capital compared to the previous year. However, in 2019, the ratio was higher at 2.53, indicating that the company was more efficient in generating sales relative to the working capital deployed.
Overall, the fluctuating trend in Ingersoll-Rand Inc's working capital turnover suggests variations in how effectively the company managed its working capital to support sales in different years. An increasing ratio indicates improved efficiency, while a decreasing ratio may suggest a need for better working capital management strategies.
Peer comparison
Dec 31, 2023