Stryker Corporation (SYK)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 20,498,000 | 18,449,000 | 17,108,000 | 14,351,000 | 14,884,000 |
| Total current assets | US$ in thousands | 12,518,000 | 10,275,000 | 10,017,000 | 9,707,000 | 11,058,000 |
| Total current liabilities | US$ in thousands | 7,921,000 | 6,303,000 | 4,549,000 | 5,041,000 | 4,400,000 |
| Working capital turnover | 4.46 | 4.64 | 3.13 | 3.08 | 2.24 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $20,498,000K ÷ ($12,518,000K – $7,921,000K)
= 4.46
Stryker Corp.'s working capital turnover has exhibited an increasing trend from 2.14 in 2019 to 4.46 in 2023, indicating that the company is efficiently utilizing its working capital to generate sales. This metric measures how effectively the company is managing its working capital in relation to its revenue generation.
The steady improvement in the working capital turnover ratio suggests that Stryker Corp. has been able to streamline its operational efficiency and manage its assets and liabilities effectively over the years. A higher turnover ratio is generally considered favorable as it indicates that the company is generating more revenue per dollar of working capital invested.
The company's ability to convert its working capital into sales has improved significantly, which may be attributed to better management of inventory, accounts receivable, and accounts payable. This efficient use of working capital can lead to improved cash flows and profitability for Stryker Corp.
Overall, the increasing trend in Stryker Corp.'s working capital turnover ratio reflects positively on the company's operational efficiency and financial management practices.
Peer comparison
Dec 31, 2023