Nike Inc (NKE)
Working capital turnover
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 51,500,000 | 51,430,000 | 46,736,000 | 44,676,000 | 37,380,000 |
| Total current assets | US$ in thousands | 25,382,000 | 25,202,000 | 28,213,000 | 26,291,000 | 20,556,000 |
| Total current liabilities | US$ in thousands | 10,593,000 | 9,256,000 | 10,730,000 | 9,674,000 | 8,284,000 |
| Working capital turnover | 3.48 | 3.23 | 2.67 | 2.69 | 3.05 |
May 31, 2024 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $51,500,000K ÷ ($25,382,000K – $10,593,000K)
= 3.48
Nike Inc's working capital turnover has shown variability over the past five years, ranging from 2.67 to 3.48. The working capital turnover indicates how efficiently the company is utilizing its working capital to generate sales revenue.
An increasing trend in working capital turnover is generally positive as it signifies that the company is effectively managing its working capital to support its operations and sales. Nike's working capital turnover has shown an increasing trend from 2.67 in 2022 to 3.48 in 2024, which suggests that the company has been more efficient in utilizing its working capital to generate sales revenue during this period.
However, it is important to note that a very high working capital turnover may also indicate aggressive management of working capital, which could potentially lead to operational risks or insufficient liquidity. Therefore, while the increasing trend in Nike's working capital turnover is a positive sign of efficiency, the company should ensure a balance between working capital management and operational requirements to maintain sustainable growth and financial stability.
Peer comparison
May 31, 2024