Medpace Holdings Inc (MEDP)

Receivables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	1,883,940	1,519,300	1,145,160	926,439	860,388
Receivables	US$ in thousands	298,400	253,404	186,432	160,962	155,662
Receivables turnover		6.31	6.00	6.14	5.76	5.53

December 31, 2023 calculation

Receivables turnover = Revenue ÷ Receivables
= $1,883,940K ÷ $298,400K
= 6.31

The receivables turnover of Medpace Holdings Inc has shown a generally increasing trend over the past five years, with values of 5.53, 5.75, 6.13, 5.76, and 6.32 for the years 2019 to 2023, respectively. This suggests that the company is collecting its accounts receivable more efficiently and quickly. A higher turnover ratio indicates that the company is converting its accounts receivable into cash more frequently during the year.

The improved receivables turnover could be attributed to better credit management practices, prompt collection efforts, and efficient sales operations. Higher turnover ratios are generally favorable as they indicate that the company's credit policies are effective, and there is minimal risk of bad debts or delayed payments.

It is also essential to consider industry benchmarks and compare Medpace Holdings Inc's receivables turnover with its peers to assess its efficiency in managing receivables. Overall, the increasing trend in receivables turnover for Medpace Holdings Inc reflects positively on the company's financial health and operational efficiency.