CarMax Inc (KMX)

Payables turnover

		Feb 29, 2024	Feb 28, 2023	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020
Cost of revenue	US$ in thousands	23,822,800	26,884,700	28,612,900	16,571,000	17,597,600
Payables	US$ in thousands	933,708	826,592	937,717	799,333	737,144
Payables turnover		25.51	32.52	30.51	20.73	23.87

February 29, 2024 calculation

Payables turnover = Cost of revenue ÷ Payables
= $23,822,800K ÷ $933,708K
= 25.51

CarMax Inc's payables turnover ratio measures how efficiently the company is managing its accounts payable by calculating how many times a year the company pays off its suppliers.

Over the past five years, CarMax Inc's payables turnover ratio has fluctuated, ranging from 20.73 to 32.52. The average payables turnover ratio during this period is approximately 26.23.

A higher payables turnover ratio indicates that the company is paying off its suppliers more quickly, which can be a sign of good financial health and effective management of working capital. On the other hand, a lower payables turnover ratio may suggest that the company is taking longer to pay its suppliers, potentially leading to strained relationships or missed early payment discounts.

In summary, CarMax Inc's payables turnover ratio has shown variability over the years, and it is essential for investors and stakeholders to monitor this ratio alongside other financial metrics to assess the company's overall financial performance.