Vontier Corp (VNT)
Payables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 785,000 | 2,577,600 | 2,363,800 | 2,094,000 |
| Payables | US$ in thousands | 366,800 | 430,900 | 424,900 | 367,400 |
| Payables turnover | 2.14 | 5.98 | 5.56 | 5.70 |
December 31, 2023 calculation
Payables turnover = Cost of revenue ÷ Payables
= $785,000K ÷ $366,800K
= 2.14
The payables turnover ratio for Vontier Corporation has shown a fluctuating trend over the past five years. The ratio increased from 4.96 in 2019 to 4.13 in 2020, indicating a decrease in the speed at which the company pays its suppliers. However, in 2021, the ratio improved to 3.90, suggesting a faster turnover of payables. Subsequently, the ratio further increased to 4.08 in 2022, and ultimately reached 4.54 in 2023.
This upward trend in payables turnover from 2020 to 2023 may imply that Vontier Corporation has been managing its accounts payable more efficiently, potentially negotiating better payment terms with suppliers or streamlining its payment processes. A higher payables turnover ratio generally indicates that the company is paying its suppliers more quickly, which could be beneficial in terms of maintaining good supplier relationships and possibly taking advantage of early payment discounts.
However, it's essential to note that while a high payables turnover ratio can be advantageous, an excessively high ratio may also signal financial distress or liquidity issues as the company may be struggling to meet its payment obligations. Therefore, further analysis of Vontier Corporation's overall financial health and cash flow management is necessary to provide a more comprehensive assessment of the company's performance.
Peer comparison
Dec 31, 2023