TRI Pointe Homes Inc (TPH)

Working capital turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Revenue	US$ in thousands	3,715,200	4,348,530	3,982,240	3,260,450	3,083,020
Total current assets	US$ in thousands	868,953	889,664	681,528	621,295	329,011
Total current liabilities	US$ in thousands	43,991	42,027	55,156	43,602	20,876
Working capital turnover		4.50	5.13	6.36	5.64	10.01

December 31, 2023 calculation

Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $3,715,200K ÷ ($868,953K – $43,991K)
= 4.50

Tri Pointe Homes Inc.'s working capital turnover has demonstrated fluctuations over the past five years. The ratio declined from 25.57 in 2019 to 9.55 in 2020 before slightly increasing to 11.02 in 2021. Subsequently, there was a significant decline to 6.43 in 2022 and a further decrease to 5.43 in 2023. This indicates that the company is generating less revenue relative to its working capital in recent years. A lower working capital turnover may imply inefficiencies in managing working capital to support revenue generation. The declining trend over the years may prompt further investigation into the company's liquidity management and operational efficiency.