Xylem Inc (XYL)
Payables turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 5,350,000 | 4,647,000 | 3,438,000 | 3,220,000 | 3,046,000 |
| Payables | US$ in thousands | 1,006,000 | 968,000 | 723,000 | 639,000 | 569,000 |
| Payables turnover | 5.32 | 4.80 | 4.76 | 5.04 | 5.35 |
December 31, 2024 calculation
Payables turnover = Cost of revenue ÷ Payables
= $5,350,000K ÷ $1,006,000K
= 5.32
The payables turnover ratio for Xylem Inc has shown a slight decrease over the years, from 5.35 in December 2020 to 5.32 in December 2024. This ratio indicates that the company is taking slightly longer to pay off its suppliers in recent years.
A payables turnover ratio measures how efficiently a company manages its accounts payable by comparing the total purchases on credit to the average accounts payable during a specific period. A higher ratio generally implies that the company is paying its suppliers more quickly, while a lower ratio could suggest that the company is taking longer to pay its bills.
Overall, despite the slight decrease in the payables turnover ratio, Xylem Inc still appears to be efficiently managing its accounts payable obligations. Nonetheless, management may want to keep an eye on this trend to ensure that payment terms remain favorable and sustainable for the business.
Peer comparison
Dec 31, 2024