Vertex Pharmaceuticals Inc (VRTX)
Payables turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 3,045,900 | 2,443,200 | 2,076,000 | 1,796,200 | 1,557,980 |
| Payables | US$ in thousands | 413,000 | 364,900 | 303,900 | 195,000 | 155,100 |
| Payables turnover | 7.38 | 6.70 | 6.83 | 9.21 | 10.05 |
December 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $3,045,900K ÷ $413,000K
= 7.38
The payables turnover ratio for Vertex Pharmaceuticals Inc has shown a declining trend over the past five years. In December 2020, the ratio stood at 10.05, indicating that the company was able to convert its accounts payable into cash 10.05 times during that year. However, by December 2024, the payables turnover ratio had decreased to 7.38, suggesting a decrease in the efficiency of paying off its suppliers relative to its cost of goods sold. This may indicate that Vertex Pharmaceuticals Inc is taking longer to settle its payables, which could potentially strain its relationships with suppliers or result in missed opportunities to benefit from early payment discounts. Further analysis is recommended to understand the underlying reasons for this downward trend in payables turnover.
Peer comparison
Dec 31, 2024