Sherwin-Williams Co (SHW)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 19,741,500 | 19,215,600 | 17,284,300 | 15,514,700 | 9,864,700 |
| Payables | US$ in thousands | 2,315,000 | 2,436,500 | 2,403,000 | 2,117,800 | 1,876,300 |
| Payables turnover | 8.53 | 7.89 | 7.19 | 7.33 | 5.26 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $19,741,500K ÷ $2,315,000K
= 8.53
The payables turnover ratio for Sherwin-Williams Co. has shown relatively stable performance over the past five years. The ratio increased from 4.57 in 2020 to 5.31 in 2023, indicating that the company generated more revenue relative to its accounts payable during this period.
A higher payables turnover ratio suggests that the company is efficiently managing its accounts payable by paying suppliers more frequently or negotiating better credit terms. This can be indicative of strong liquidity and working capital management.
However, it's essential to consider the industry norms and compare Sherwin-Williams' payables turnover ratio with its competitors to gain a better understanding of its performance in managing payables effectively. Overall, the consistent improvement in the payables turnover ratio for Sherwin-Williams Co. reflects positively on its financial health and operational efficiency.
Peer comparison
Dec 31, 2023