Northrop Grumman Corporation (NOC)

Receivables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	39,290,000	36,602,000	35,667,000	36,799,000	33,841,000
Receivables	US$ in thousands	7,147,000	7,494,000	6,959,000	6,641,000	6,660,000
Receivables turnover		5.50	4.88	5.13	5.54	5.08

December 31, 2023 calculation

Receivables turnover = Revenue ÷ Receivables
= $39,290,000K ÷ $7,147,000K
= 5.50

The receivables turnover ratio measures how efficiently a company is able to collect its outstanding receivables during a period. A higher ratio indicates that the company is collecting receivables more quickly.

Northrop Grumman Corp.'s receivables turnover has fluctuated over the past five years, ranging from 4.88 to 5.54. The ratio was highest in 2020 at 5.54, indicating that the company efficiently collected its receivables during that year. However, the ratio decreased in 2021 to 5.13, before increasing again to 5.50 in 2023.

The upward trend in 2023 suggests an improvement in the company's ability to collect receivables compared to the previous year. This may be indicative of more effective credit and collection policies, better customer payment behavior, or a more streamlined invoicing and collection process. It is important to note that a consistently high receivables turnover ratio reflects positively on a company's liquidity and indicates a strong ability to convert credit sales into cash.

Overall, the receivables turnover ratio analysis for Northrop Grumman Corp. indicates generally efficient management of its accounts receivable over the past five years, with a slight fluctuation in performance.