Wingstop Inc (WING)

Payables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	170,244	132,656	122,611	119,868	100,800
Payables	US$ in thousands	4,725	5,219	5,414	3,658	3,348
Payables turnover		36.03	25.42	22.65	32.77	30.11

December 31, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $170,244K ÷ $4,725K
= 36.03

Wingstop Inc's payables turnover has shown variability over the past five years, ranging from 22.65 in 2021 to 36.03 in 2023. This ratio indicates how efficiently the company is managing its accounts payable by measuring how many times a company pays off its average accounts payable balance during a period.

The increase in payables turnover from 2021 to 2023 suggests that Wingstop Inc has been able to more effectively manage its payables during this period. It may have been negotiating better payment terms with suppliers or improving its working capital management.

However, the fluctuations in the payables turnover ratio over the years indicate some inconsistency in managing its accounts payable. It is essential for Wingstop Inc to maintain a balance in managing payables to ensure it does not strain relationships with suppliers while also optimizing its cash flow.

Overall, although the recent increase in payables turnover is a positive sign for the company's efficiency in managing its accounts payable, Wingstop Inc should continue to monitor and improve its payables turnover to ensure sustainable financial health.