Illinois Tool Works Inc (ITW)
Receivables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 15,803,000 | 15,723,000 | 14,244,000 | 12,361,000 | 13,887,000 |
| Receivables | US$ in thousands | 3,123,000 | 3,171,000 | 2,840,000 | 2,506,000 | 2,461,000 |
| Receivables turnover | 5.06 | 4.96 | 5.02 | 4.93 | 5.64 |
December 31, 2023 calculation
Receivables turnover = Revenue ÷ Receivables
= $15,803,000K ÷ $3,123,000K
= 5.06
The receivables turnover ratio of Illinois Tool Works, Inc. has shown a relatively stable trend over the past five years, ranging from 4.80 to 5.40 times. This ratio measures the efficiency at which the company collects cash from its credit sales during a given period.
The slight fluctuations in the receivables turnover ratio indicate that the company has been successful in managing its accounts receivable efficiently. A higher turnover ratio suggests that the company is collecting its outstanding receivables more quickly, which is generally considered favorable as it indicates prompt collection of sales revenue.
Overall, Illinois Tool Works, Inc. has maintained a healthy level of receivables turnover over the years, reflecting its effective credit management practices and ability to convert credit sales into cash.
Peer comparison
Dec 31, 2023