Yelp Inc (YELP)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 1,350,660 | 1,205,530 | 1,040,560 | 880,779 | 1,018,980 |
| Total current assets | US$ in thousands | 624,216 | 595,992 | 644,677 | 712,725 | 533,309 |
| Total current liabilities | US$ in thousands | 175,864 | 182,824 | 164,013 | 143,030 | 134,155 |
| Working capital turnover | 3.01 | 2.92 | 2.16 | 1.55 | 2.55 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $1,350,660K ÷ ($624,216K – $175,864K)
= 3.01
The working capital turnover ratio for Yelp Inc has shown fluctuations over the past five years. The ratio indicates how effectively the company is utilizing its working capital to generate revenue.
In 2023, the working capital turnover ratio increased to 2.98, reflecting an improvement in efficiency compared to the previous year. This suggests that Yelp Inc was able to generate $2.98 in revenue for every dollar of working capital invested during the year.
Looking back, the ratio was relatively stable in 2022 at 2.89, showing a consistent performance in utilizing working capital to generate revenue. In 2021, the ratio increased to 2.15 from the previous year, indicating a positive trend in managing working capital efficiently.
However, in 2020, the working capital turnover ratio dropped to 1.53, which could be a cause for concern as it suggests a decline in efficiency in utilizing working capital to generate revenue. The ratio bounced back in 2019 to 2.54, showing an improvement compared to the previous year.
Overall, it is important for Yelp Inc to closely monitor its working capital turnover ratio to ensure efficient use of working capital in generating revenue, as variations in this ratio can impact the company's financial performance and liquidity.
Peer comparison
Dec 31, 2023