Vertex Pharmaceuticals Inc (VRTX)
Receivables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 9,803,200 | 8,863,500 | 7,499,400 | 6,135,450 | 4,105,510 |
| Receivables | US$ in thousands | 1,563,400 | 1,442,200 | 1,136,800 | 885,352 | 633,518 |
| Receivables turnover | 6.27 | 6.15 | 6.60 | 6.93 | 6.48 |
December 31, 2023 calculation
Receivables turnover = Revenue ÷ Receivables
= $9,803,200K ÷ $1,563,400K
= 6.27
The receivables turnover ratio for Vertex Pharmaceuticals, Inc. has been relatively stable over the past five years, ranging from 6.19 to 7.01. This ratio indicates how efficiently the company is able to collect payments from its customers.
A higher receivables turnover ratio suggests that the company is more effective in collecting outstanding receivables, which is generally preferred as it implies quicker conversion of credit sales into cash.
Vertex Pharmaceuticals, Inc. has maintained a healthy level of receivables turnover, reflecting good management of its accounts receivable and a strong credit control process. This consistency in the ratio over the years indicates the company's ability to effectively manage its receivables and maintain a steady cash flow from its sales operations.
Peer comparison
Dec 31, 2023