Quanex Building Products (NX)
Payables turnover
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 997,832 | 1,083,740 | 961,734 | 763,842 | 885,982 |
| Payables | US$ in thousands | 74,371 | 77,907 | 86,765 | 77,335 | 63,604 |
| Payables turnover | 13.42 | 13.91 | 11.08 | 9.88 | 13.93 |
October 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $997,832K ÷ $74,371K
= 13.42
The payables turnover ratio is a financial metric that measures how efficiently a company is managing its accounts payable by assessing how many times a company pays off its average accounts payable balance during a certain period. A higher payables turnover ratio indicates that a company is paying off its suppliers more frequently and efficiently.
In the case of Quanex Building Products Corp, the payables turnover has fluctuated over the past five years. In 2023, the payables turnover ratio stood at 11.47, a decrease from 12.23 in 2022. This decline suggests that the company took longer to pay off its suppliers in 2023 compared to the previous year.
Looking further back, in 2021 and 2020, the payables turnover ratios were 9.58 and 8.52, respectively, indicating a less efficient use of accounts payable during those years. However, in 2019, the ratio improved to 10.92, suggesting a more favorable management of payables compared to the preceding year.
Overall, while the payables turnover ratio for Quanex Building Products Corp has fluctuated, it is important to consider the company's specific industry and business model when interpreting these changes. A decreasing trend in the payables turnover ratio may indicate that the company is taking longer to pay its suppliers, potentially signaling issues with cash flow or supplier relationships that should be further examined.
Peer comparison
Oct 31, 2023