Vector Group Ltd (VGR)
Receivables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 1,424,270 | 1,441,010 | 1,220,700 | 1,228,680 | 1,119,600 |
| Receivables | US$ in thousands | 26,442 | 49,131 | 27,015 | 40,711 | 36,959 |
| Receivables turnover | 53.86 | 29.33 | 45.19 | 30.18 | 30.29 |
December 31, 2023 calculation
Receivables turnover = Revenue ÷ Receivables
= $1,424,270K ÷ $26,442K
= 53.86
The receivables turnover ratio for Vector Group Ltd has shown fluctuating trends over the past five years. In 2023, the company's receivables turnover ratio stood at 53.86, indicating that on average, the company collected its accounts receivable approximately 53.86 times during the year. This represents a significant improvement from the previous year's ratio of 29.33.
The increase in the receivables turnover ratio from 2022 to 2023 suggests that Vector Group Ltd has become more efficient in collecting payments from its customers, potentially indicating tighter credit policies or more effective collection efforts. A higher receivables turnover ratio is generally viewed positively as it implies a quicker collection of outstanding invoices, which can improve cash flow and reduce the risk of bad debts.
However, it's notable that the 2023 ratio of 53.86 is substantially higher than the ratios from 2021, 2020, and 2019, which were 45.19, 49.19, and 51.51, respectively. While the sharp increase in 2023 may be a sign of enhanced efficiency in accounts receivable management, it might also indicate overly aggressive collection practices that could potentially strain customer relationships.
Overall, the latest receivables turnover ratio of 53.86 for Vector Group Ltd reflects a positive trend in improving the efficiency of collecting payments from customers, but the significant increase warrants further investigation into the company's credit and collection policies to ensure a balanced approach that nurtures customer relationships while optimizing cash flow.
Peer comparison
Dec 31, 2023