Lithia Motors Inc (LAD)

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		101.83	93.01	92.52	83.23	101.62	105.66	91.63	89.36	90.00	76.93	65.51	69.34	78.58	58.08	65.42	75.87	63.45	82.52	79.48	85.43
Number of days of payables	days	3.58	3.92	3.95	4.39	3.59	3.45	3.98	4.08	4.06	4.74	5.57	5.26	4.64	6.28	5.58	4.81	5.75	4.42	4.59	4.27

December 31, 2023 calculation

Number of days of payables = 365 ÷ Payables turnover
= 365 ÷ 101.83
= 3.58

The number of days of payables for Lithia Motors, Inc. has shown a slight fluctuation over the past eight quarters, ranging from 3.94 days to 5.00 days. In Q4 2023, the number of days of payables decreased to 4.07 days from 4.46 days in the previous quarter. This indicates that the company is taking less time on average to pay its suppliers compared to the previous quarter. However, when compared to the same quarter last year (Q4 2022), the number of days of payables remains relatively consistent at 4.09 days.

Overall, a lower number of days of payables suggests that the company is managing its accounts payable efficiently by paying its suppliers promptly. This can indicate good vendor relationships and potentially favorable payment terms negotiated by the company. In contrast, a higher number of days of payables may signal cash flow constraints or inefficiencies in managing working capital. Monitoring this ratio over time can provide insights into the company's payment practices and financial health.