Motorola Solutions Inc (MSI)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 6,799,000 | 6,632,000 | 5,762,000 | 5,411,000 | 5,636,000 |
| Payables | US$ in thousands | 881,000 | 1,062,000 | 851,000 | 612,000 | 618,000 |
| Payables turnover | 7.72 | 6.24 | 6.77 | 8.84 | 9.12 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $6,799,000K ÷ $881,000K
= 7.72
The payables turnover ratio measures how efficiently a company is managing its accounts payable by indicating how many times the company pays off its suppliers in a given period.
Looking at the trend of Motorola Solutions Inc's payables turnover ratio over the past five years, we see fluctuations in the ratio. The ratio was 4.90 in 2023, a slight increase from 4.05 in 2022, indicating that the company paid off its suppliers almost 5 times during 2023. This improvement suggests that the company may have been more efficient in managing its accounts payable in 2023 compared to the previous year.
However, the ratio was relatively stable at around 3.80 to 5.08 in the years prior to 2022. These fluctuations may indicate variations in the company's payment terms with suppliers or changes in its purchasing patterns.
Overall, a higher payables turnover ratio generally indicates more efficient management of accounts payable, as the company is paying off its suppliers more frequently. In contrast, a lower ratio may suggest that the company is taking longer to settle its payables.
It would be beneficial to further investigate the reasons behind the fluctuating payables turnover ratio to gain a better understanding of Motorola Solutions Inc's financial management practices and supplier relationships.
Peer comparison
Dec 31, 2023