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