Wingstop Inc (WING)

Payables turnover

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cost of revenue	US$ in thousands	211,733	170,244	132,656	122,611	119,868
Payables	US$ in thousands	6,943	4,725	5,219	5,414	3,658
Payables turnover		30.50	36.03	25.42	22.65	32.77

December 31, 2024 calculation

Payables turnover = Cost of revenue ÷ Payables
= $211,733K ÷ $6,943K
= 30.50

To analyze Wingstop Inc's payables turnover over the past five years, we can see a fluctuating trend. The payables turnover ratio measures how efficiently a company manages its accounts payable by evaluating how many times a company pays off its average accounts payable balance during a certain period.

In December 2020, the payables turnover ratio stood at 32.77, indicating that Wingstop Inc was able to pay off its accounts payable approximately 32.77 times during the year. This high ratio suggests that the company effectively managed its payables during that period.

However, in the following years, we observe a downward trend in the payables turnover ratio. By December 31, 2021, the ratio decreased to 22.65, showing a potential slowdown in the company's ability to pay off its accounts payable compared to the previous year.

In December 2022 and 2024, the payables turnover ratio improved slightly to 25.42 and 30.50, respectively. This indicates that Wingstop Inc managed to enhance its payables turnover efficiency during those years.

Notably, by December 2023, Wingstop Inc achieved a significant increase in its payables turnover ratio to 36.03, indicating a notable improvement in managing its accounts payable effectively.

Overall, the varying trends in Wingstop Inc's payables turnover ratio over the past five years suggest fluctuations in the company's ability to efficiently manage its accounts payable. It is essential for stakeholders to monitor this ratio closely to assess Wingstop Inc's financial health and operational efficiency in managing its working capital.