Wingstop Inc (WING)

Fixed asset turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Revenue (ttm)	US$ in thousands	625,807	591,043	545,649	497,123	460,055	437,865	413,433	390,037	357,521	324,682	297,794	288,017	282,502	273,756	271,960	264,065	248,811	238,715	224,602	207,059
Property, plant and equipment	US$ in thousands	125,953	119,119	107,738	99,345	91,292	84,344	78,570	71,518	66,851	63,236	60,854	57,314	54,503	49,151	39,598	30,473	27,948	27,196	27,220	28,434
Fixed asset turnover		4.97	4.96	5.06	5.00	5.04	5.19	5.26	5.45	5.35	5.13	4.89	5.03	5.18	5.57	6.87	8.67	8.90	8.78	8.25	7.28

December 31, 2024 calculation

Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $625,807K ÷ $125,953K
= 4.97

The fixed asset turnover ratio for Wingstop Inc has exhibited fluctuations over the analyzed period. The ratio, which measures how efficiently the company generates revenue from its fixed assets, peaked at 8.90 on December 31, 2020, indicating that Wingstop was generating $8.90 in sales for every dollar invested in fixed assets. However, since then, the ratio has gradually declined, reaching a low of 4.96 on September 30, 2024.

The decreasing trend in fixed asset turnover suggests that Wingstop may be becoming less efficient in utilizing its fixed assets to generate revenue. A declining ratio could be attributed to various factors such as slower sales growth, underutilization of assets, or inefficient asset management.

It is crucial for Wingstop to closely monitor its fixed asset turnover ratio and identify opportunities to improve asset utilization in order to enhance operational efficiency and maximize profitability. Further analysis and strategic adjustments may be necessary to address the declining trend observed in the fixed asset turnover ratio.