Lithia Motors Inc (LAD)

Receivables turnover

		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
Revenue (ttm)	US$ in thousands	30,848,600	30,176,800	29,204,400	28,342,500	28,084,900	27,422,400	26,318,100	25,093,700	22,727,900	20,377,000	17,838,800	14,600,400	13,069,800	12,354,800	12,083,600	12,562,400	12,624,200	12,377,000	12,136,600	12,011,400
Receivables	US$ in thousands	1,123,100	999,300	884,600	843,100	813,100	1,004,600	978,400	923,800	910,000	812,600	799,700	740,700	614,000	511,700	446,400	298,200	505,000	459,700	489,200	491,000
Receivables turnover		27.47	30.20	33.01	33.62	34.54	27.30	26.90	27.16	24.98	25.08	22.31	19.71	21.29	24.14	27.07	42.13	25.00	26.92	24.81	24.46

December 31, 2023 calculation

Receivables turnover = Revenue (ttm) ÷ Receivables
= $30,848,600K ÷ $1,123,100K
= 27.47

The receivables turnover ratio measures how efficiently a company is managing its receivables by indicating the number of times during a period that a company collects its average accounts receivable balance.

In the case of Lithia Motors, Inc., the receivables turnover ratio has shown some fluctuations over the past eight quarters. The ratio ranged from a low of 27.01 in Q2 2022 to a high of 34.67 in Q4 2022. The most recent data for Q4 2023, with a receivables turnover of 27.64, indicates a slight decrease compared to the previous two quarters.

A higher receivables turnover ratio generally suggests that the company is collecting its receivables more quickly, indicating efficient management of accounts receivable. Conversely, a lower ratio may indicate potential issues with collection efforts or an increase in credit sales.

It is important to consider industry norms and trends when assessing the significance of these ratios. Further analysis of the company's receivables collection policies, credit terms, and overall financial performance would provide additional insights into the effectiveness of its receivables management.