Shake Shack Inc (SHAK)
Working capital turnover
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | Sep 23, 2020 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 1,252,608 | 1,210,167 | 1,169,450 | 1,124,759 | 1,087,533 | 1,039,819 | 991,426 | 950,373 | 900,486 | 865,213 | 831,294 | 788,002 | 739,893 | 694,147 | 630,653 | 573,083 | 509,587 | 495,247 | 516,281 | 544,153 |
| Total current assets | US$ in thousands | 368,216 | 354,016 | 345,680 | 326,189 | 334,432 | 323,236 | 329,518 | 330,074 | 343,988 | 367,055 | 387,575 | 386,617 | 409,676 | 419,180 | 438,161 | 435,290 | 203,186 | 204,510 | 204,510 | 204,076 |
| Total current liabilities | US$ in thousands | 187,313 | 175,833 | 168,088 | 161,083 | 164,062 | 152,177 | 150,185 | 143,052 | 147,718 | 144,542 | 133,909 | 125,961 | 121,497 | 118,259 | 124,491 | 118,749 | 109,705 | 104,266 | 104,266 | 96,673 |
| Working capital turnover | 6.92 | 6.79 | 6.59 | 6.81 | 6.38 | 6.08 | 5.53 | 5.08 | 4.59 | 3.89 | 3.28 | 3.02 | 2.57 | 2.31 | 2.01 | 1.81 | 5.45 | 4.94 | 5.15 | 5.07 |
December 31, 2024 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $1,252,608K ÷ ($368,216K – $187,313K)
= 6.92
The working capital turnover ratio of Shake Shack Inc has been consistently increasing over the recent quarters, indicating an improvement in the company's efficiency in generating sales from its working capital. The ratio stood at around 5 in mid-2020 and has gradually increased to approximately 6.92 by the end of 2024.
A higher working capital turnover ratio is generally considered favorable as it signifies that the company is effectively utilizing its current assets to generate revenue. This upward trend suggests that Shake Shack Inc has been able to manage its working capital more effectively over time, potentially leading to increased operational efficiency and profitability.
It is important to note that a working capital turnover ratio that is too high could also indicate aggressive sales strategies or inventory turnover, which may carry risks such as stockouts or pressure on suppliers. Therefore, while the increasing trend in Shake Shack Inc's working capital turnover ratio is a positive sign, continued monitoring and analysis of the company's working capital management practices will be essential for sustainable growth and performance.
Peer comparison
Dec 31, 2024