N-Able Inc (NABL)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|
| Revenue | US$ in thousands | 420,409 | 371,392 | 344,291 |
| Total current assets | US$ in thousands | 224,791 | 154,156 | 120,989 |
| Total current liabilities | US$ in thousands | 81,717 | 61,814 | 60,878 |
| Working capital turnover | 2.94 | 4.02 | 5.73 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $420,409K ÷ ($224,791K – $81,717K)
= 2.94
The working capital turnover ratio measures how efficiently a company utilizes its working capital to generate sales revenue. In the case of N-Able Inc, the working capital turnover ratio has been declining over the past three years, from 5.73 in 2021 to 2.94 in 2023. This indicates that the company is becoming less efficient in using its working capital to support its sales activities.
A decreasing working capital turnover ratio may suggest that N-Able Inc is struggling to effectively manage its working capital, resulting in a decrease in sales generated for every dollar of working capital invested. This could be attributed to issues such as inefficient inventory management, slow collection of receivables, or excessive levels of current assets relative to sales.
Management should closely monitor the trend of the working capital turnover ratio and take appropriate measures to improve efficiency in working capital management. By optimizing working capital levels and streamlining operational processes, N-Able Inc can enhance its ability to generate sales with the available working capital resources.
Peer comparison
Dec 31, 2023