Stepan Company (SCL)
Receivables turnover
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 2,306,119 | 2,409,124 | 2,565,319 | 2,735,064 | 2,759,510 | 2,746,863 | 2,632,121 | 2,477,612 | 2,339,459 | 2,223,132 | 2,085,032 | 1,950,387 | 1,863,537 | 1,821,473 | 1,808,473 | 1,819,863 | 1,859,078 | 1,880,747 | 1,936,514 | 2,504,002 |
| Receivables | US$ in thousands | 422,050 | 418,218 | 423,399 | 470,275 | 436,914 | 476,198 | 518,750 | 504,474 | 419,542 | 413,576 | 391,730 | 380,649 | 301,318 | 295,616 | 286,679 | 290,568 | 276,841 | 283,016 | 289,023 | 298,932 |
| Receivables turnover | 5.46 | 5.76 | 6.06 | 5.82 | 6.32 | 5.77 | 5.07 | 4.91 | 5.58 | 5.38 | 5.32 | 5.12 | 6.18 | 6.16 | 6.31 | 6.26 | 6.72 | 6.65 | 6.70 | 8.38 |
December 31, 2023 calculation
Receivables turnover = Revenue (ttm) ÷ Receivables
= $2,306,119K ÷ $422,050K
= 5.46
The receivables turnover ratio measures how efficiently a company is managing its receivables by indicating how many times during a period the company collects its average accounts receivable balance.
In the case of Stepan Co., the receivables turnover has fluctuated over the past eight quarters. The trend shows a general increase from Q1 2022 to Q2 2023, indicating an improvement in the efficiency of the company's receivables management.
During Q2 and Q3 2022, the receivables turnover ratio was relatively stable at around 5.79, but it started to increase in Q4 2022 and continued to rise through Q2 2023, peaking at 6.09. However, in Q4 2023, there was a slight decrease to 5.51.
An increasing receivables turnover ratio suggests that Stepan Co. is collecting its accounts receivable more quickly, which could be a positive sign of effective credit policies and collection procedures. On the other hand, a decreasing ratio may indicate potential issues with collecting receivables in a timely manner.
Overall, the varying levels of the receivables turnover ratio for Stepan Co. over the analyzed period suggest changes in the company's receivables management efficiency, which could be influenced by factors such as changes in credit terms, customer payment behavior, or overall economic conditions.
Peer comparison
Dec 31, 2023