Laboratory Corporation of America Holdings (LH)

Working capital turnover

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Revenue US$ in thousands 13,008,900 12,161,600 11,863,900 16,120,900 13,978,500
Total current assets US$ in thousands 4,806,500 3,765,400 4,625,000 5,330,500 5,125,400
Total current liabilities US$ in thousands 3,330,200 3,225,200 3,078,500 2,782,900 3,078,500
Working capital turnover 8.81 22.51 7.67 6.33 6.83

December 31, 2024 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $13,008,900K ÷ ($4,806,500K – $3,330,200K)
= 8.81

The working capital turnover ratio for Laboratory Corporation of America Holdings has shown fluctuations over the past five years, with values ranging from 6.33 to 22.51. In 2020 and 2021, the company's working capital turnover was 6.83 and 6.33, respectively, indicating that for every dollar of working capital invested, the company generated $6.83 and $6.33 in revenue during those years.

There was a notable increase in the ratio to 7.67 in 2022, suggesting an improvement in the efficiency of utilizing working capital to generate revenue. This increase was followed by a substantial surge to 22.51 in 2023, reflecting a significant enhancement in the company's ability to generate revenue from its working capital investments.

However, in 2024, the working capital turnover ratio dropped to 8.81, although it still remained higher compared to the initial years of the analyzed period. This decrease may indicate a slight decrease in efficiency in converting working capital into revenue compared to the previous year.

Overall, while the working capital turnover ratio has exhibited fluctuations, the general trend suggests an improvement in efficiency in utilizing working capital to generate revenue, with a notable peak in 2023. Monitoring this ratio over time can provide insights into the company's operational efficiency and effectiveness in managing its working capital.


Peer comparison

Dec 31, 2024

Company name
Symbol
Working capital turnover
Laboratory Corporation of America Holdings
LH
8.81
Fortrea Holdings Inc.
FTRE
Fulgent Genetics Inc
FLGT
0.67
Quest Diagnostics Incorporated
DGX
16.34
RadNet Inc
RDNT
3.38