Zoetis Inc (ZTS)
Receivables turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 8,544,000 | 8,080,000 | 7,776,000 | 6,675,000 | 6,260,000 |
| Receivables | US$ in thousands | 1,362,000 | 1,286,000 | 1,180,000 | 1,061,000 | 1,123,000 |
| Receivables turnover | 6.27 | 6.28 | 6.59 | 6.29 | 5.57 |
December 31, 2023 calculation
Receivables turnover = Revenue ÷ Receivables
= $8,544,000K ÷ $1,362,000K
= 6.27
The receivables turnover ratio for Zoetis Inc has shown a relatively consistent performance over the past five years, ranging between 5.76 and 6.86. This ratio indicates the efficiency with which the company is able to collect outstanding receivables from its customers during a specific period.
A higher receivables turnover ratio implies a more efficient collection process, with Zoetis Inc able to convert its accounts receivable into cash more frequently compared to a lower ratio. The decreasing trend seen from 2019 to 2020 followed by a slight fluctuation in the subsequent years may suggest changes in the company's credit policies, customer payment behavior, or internal collection processes.
Overall, with a receivables turnover ratio consistently above 6, Zoetis Inc appears to have a solid track record in managing its accounts receivable effectively, ensuring a steady flow of cash into the business from its credit sales.
Peer comparison
Dec 31, 2023