Sensata Technologies Holding NV (ST)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,792,820 | 2,712,050 | 2,542,430 | 2,119,040 | 2,267,430 |
| Payables | US$ in thousands | 482,301 | 531,572 | 459,093 | 393,907 | 376,968 |
| Payables turnover | 5.79 | 5.10 | 5.54 | 5.38 | 6.01 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $2,792,820K ÷ $482,301K
= 5.79
To analyze Sensata Technologies Holding Plc's payables turnover, we observe an increasing trend from 2019 to 2023. The payables turnover ratio measures the efficiency with which the company manages its trade payables by paying suppliers.
The payables turnover ratio of 5.79 in 2023 indicates that, on average, Sensata Technologies Holding Plc pays its suppliers approximately 5.79 times a year, which implies a payment cycle of around every 63 days (365 days / 5.79).
The improving trend from 5.10 in 2022 to 5.79 in 2023 suggests that the company is managing its payables more efficiently by either negotiating better payment terms with suppliers or optimizing its cash flow management.
Overall, a higher payables turnover ratio signifies better liquidity and effective management of trade credit. However, further analysis in conjunction with other financial metrics and industry benchmarks is advisable to gain a comprehensive understanding of Sensata Technologies Holding Plc's financial performance and operational efficiency.
Peer comparison
Dec 31, 2023