Illinois Tool Works Inc (ITW)

Number of days of payables

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Payables turnover		16.26	16.26	16.08	15.91	16.08	15.23	13.46	12.80	14.69	14.69	13.36	12.81	13.81	14.20	18.64	16.39	17.35	16.76	16.31	14.93
Number of days of payables	days	22.45	22.44	22.70	22.93	22.70	23.96	27.12	28.51	24.85	24.85	27.31	28.50	26.43	25.71	19.58	22.27	21.04	21.78	22.38	24.44

December 31, 2023 calculation

Number of days of payables = 365 ÷ Payables turnover
= 365 ÷ 16.26
= 22.45

Based on the historical data provided for Illinois Tool Works, Inc., the number of days of payables has shown some fluctuations over the past eight quarters. In Q4 2023, the company had an average of 22.76 days of payables, which was slightly higher compared to the previous quarter. This indicates that the company took approximately 22.76 days on average to pay off its creditors during the fourth quarter of 2023.

Overall, the trend in the number of days of payables seems to have been relatively stable, with some minor variations. It's worth noting that the number of days of payables in the most recent quarters (Q4 2022 to Q4 2023) has been consistently lower compared to the earlier quarters in 2022, indicating a potential improvement in the company's ability to manage its payables efficiently.

Analyzing the number of days of payables provides insight into how efficiently Illinois Tool Works, Inc. is managing its outstanding payments to suppliers and creditors. A lower number of days of payables may suggest a more efficient use of trade credit and working capital, while a higher number may indicate a longer payment cycle that could potentially strain cash flows. It's essential for investors and stakeholders to monitor this ratio alongside other financial metrics to assess the company's overall financial health and liquidity position.