Medpace Holdings Inc (MEDP)

Payables turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Cost of revenue (ttm)	US$ in thousands	1,634,376	1,634,969	1,622,345	1,582,770	1,524,888	1,432,835	1,332,539	1,242,298	1,162,310	1,099,215	1,036,047	981,677	927,757	879,402	822,564	762,863	747,231	713,262	716,487	721,157
Payables	US$ in thousands	32,528	26,201	27,388	24,402	31,869	29,023	33,608	37,110	33,069	28,245	28,800	25,434	25,678	25,052	23,326	21,348	26,552	15,878	14,879	16,985
Payables turnover		50.25	62.40	59.24	64.86	47.85	49.37	39.65	33.48	35.15	38.92	35.97	38.60	36.13	35.10	35.26	35.73	28.14	44.92	48.15	42.46

December 31, 2024 calculation

Payables turnover = Cost of revenue (ttm) ÷ Payables
= $1,634,376K ÷ $32,528K
= 50.25

The payables turnover ratio measures how efficiently a company is managing its payables by comparing the total purchases made on credit to the average accounts payable balance during a specific period. A higher payables turnover ratio indicates that the company is paying its suppliers more frequently, which can be a sign of strong liquidity and effective working capital management.

Analyzing the payables turnover of Medpace Holdings Inc over the past few years, we observe fluctuations in the ratio. The ratio increased steadily from March 2020 to September 2020, indicating that the company was paying its suppliers more frequently during this period. However, there was a significant decrease in the ratio by the end of December 2020. This could suggest a slowdown in payables turnover and potentially delayed payments to suppliers during that quarter.

In the following quarters, the payables turnover ratio remained relatively consistent, hovering around the mid-30s range, with occasional fluctuations. The ratio increased notably in March 2024 and June 2024, reaching its highest levels in the data provided. This improvement could indicate that the company was managing its payables more efficiently during these periods.

Overall, the trend in Medpace Holdings Inc's payables turnover ratio shows variability over the years, with some quarters demonstrating improved efficiency in managing payables, while others showing a slowdown. It would be beneficial for the company to continue monitoring and managing its payables effectively to maintain a healthy balance between payment timing and supplier relationships.