Teradyne Inc (TER)

Receivables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	2,676,300	3,155,040	3,702,880	3,121,470	2,294,960
Receivables	US$ in thousands	422,124	491,145	550,749	497,506	362,368
Receivables turnover		6.34	6.42	6.72	6.27	6.33

December 31, 2023 calculation

Receivables turnover = Revenue ÷ Receivables
= $2,676,300K ÷ $422,124K
= 6.34

The receivables turnover ratio measures how efficiently a company is collecting on its credit sales during a specific period. In the case of Teradyne, Inc., the trend in the receivables turnover ratio over the past five years has been relatively stable, ranging from 6.27 to 6.72.

A higher receivables turnover ratio indicates that the company is collecting receivables more quickly, which is generally seen as a positive sign of efficient operations. In contrast, a lower ratio may suggest that the company is taking a longer time to collect payments from customers.

The average receivables turnover ratio for Teradyne, Inc. over the five-year period is approximately 6.5. This consistent level implies that the company has been effective in managing its accounts receivable and converting sales into cash efficiently.

Overall, the receivables turnover ratio analysis suggests that Teradyne, Inc. has maintained a steady performance in collecting payments from its customers over the years, which is a favorable indicator of its operational effectiveness in managing its accounts receivable.