Stryker Corporation (SYK)

Working capital 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	20,498,000	19,885,000	19,455,000	18,952,000	18,449,000	17,948,000	17,629,000	17,430,000	17,108,000	16,669,000	16,246,000	14,716,000	14,351,000	14,220,000	14,070,000	14,956,000	14,884,000	14,549,000	14,204,000	13,876,000
Total current assets	US$ in thousands	12,518,000	11,045,000	10,151,000	10,155,000	10,275,000	9,318,000	8,825,000	8,725,000	10,017,000	9,460,000	9,032,000	8,979,000	9,707,000	13,545,000	12,801,000	10,736,000	11,058,000	8,566,000	8,185,000	7,888,000
Total current liabilities	US$ in thousands	7,921,000	7,458,000	6,584,000	5,866,000	6,303,000	4,571,000	4,404,000	4,408,000	4,549,000	4,449,000	4,252,000	3,953,000	5,041,000	4,689,000	4,405,000	4,162,000	4,400,000	3,921,000	3,946,000	3,713,000
Working capital turnover		4.46	5.54	5.45	4.42	4.64	3.78	3.99	4.04	3.13	3.33	3.40	2.93	3.08	1.61	1.68	2.28	2.24	3.13	3.35	3.32

December 31, 2023 calculation

Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $20,498,000K ÷ ($12,518,000K – $7,921,000K)
= 4.46

The working capital turnover ratio measures how effectively Stryker Corp. is utilizing its working capital to generate sales revenue. A higher ratio indicates that the company is efficiently using its current assets to support its sales activities.

Looking at the trend in the working capital turnover ratio over the past eight quarters, we observe fluctuations in the values. The ratio ranged from a low of 3.78 in Q3 2022 to a high of 5.54 in Q3 2023. This variability suggests that Stryker's efficiency in utilizing its working capital has not been consistent.

The general trend of the ratio appears to have improved over the last two quarters of 2023, with values of 5.54 and 5.45 in Q3 and Q2, respectively. This improvement indicates that the company has been able to generate more revenue relative to its working capital during these periods.

However, it's worth noting that the working capital turnover ratio slightly decreased to 4.42 in Q1 2023, which may indicate a temporary dip in efficiency in utilizing working capital to support sales activities compared to the previous quarters of 2023.

Overall, while there are fluctuations in the working capital turnover ratio, the recent improvement in the ratio suggests that Stryker Corp. has made progress in optimizing its working capital efficiency to generate sales revenue. Monitoring this ratio over time will be important to assess the company's ongoing performance in this area.