Analysis of Short-term (Operating) Activity Ratios
Quarterly Data
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
Short-term Activity Ratios (Summary)
Monster Beverage Corp., short-term (operating) activity ratios (quarterly data)
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
The analysis of the quarterly financial ratios reveals distinct trends and fluctuations in the company's operational efficiency and working capital management over the observed periods.
- Inventory Turnover
- The inventory turnover ratio showed a general declining trend after peaking around 2020. Initially increasing from 4.66 in early 2019 to a high of 5.67 by late 2020, it declined significantly afterward, reaching values near 3.44 to 3.78 in the most recent quarters. This suggests slower inventory movement and potentially longer holding periods.
- Receivables Turnover
- This ratio generally decreased over time, starting at 7.77 and dropping to values between 5.02 and 5.98 in recent quarters. The trend indicates a lengthening in the average collection period, consistent with increased credit risk or relaxed collection practices.
- Payables Turnover
- Payables turnover has remained relatively stable with some volatility, fluctuating mostly between 5.6 and 6.5. Notably, a spike to 7.06 in late 2022 suggests a temporary acceleration in payments to suppliers, but the ratio generally hovers near prior levels, indicating consistent payment behavior.
- Working Capital Turnover
- This ratio exhibited a downward trajectory from around 2.54 increasing to 3.2 mid-2019, then consistently declining to levels near 1.5 to 1.7 in the latest periods. The steady decrease points to less efficient use of working capital relative to sales, possibly indicating increased current asset levels or reduced sales growth.
- Average Inventory Processing Period
- The average days inventory was held increased markedly from approximately 66 days at the end of 2019 to over 100 days from 2022 onward, peaking near 113 days. This trend corresponds to the decreased inventory turnover and suggests slower inventory liquidation.
- Average Receivable Collection Period
- The period showed an increasing trend from 47 days in early 2019 to about 65 to 73 days recently. The elongation implies slower customer payments and potentially higher credit risk or changed credit terms.
- Operating Cycle
- The operating cycle, the sum of inventory and receivable periods, rose from about 125 days in 2019 to a peak around 170 days and beyond from 2021 forward. The elongation of the operating cycle reflects slower movement through the cash-to-cash process.
- Average Payables Payment Period
- This metric remained relatively stable, fluctuating between 52 and 65 days without a clear trend. The company appears to maintain consistent payment terms with suppliers across the timeframe.
- Cash Conversion Cycle
- The cash conversion cycle mirrored the pattern of the operating cycle but was lower due to payables deferral. It increased from roughly 66 days in 2019 to over 100 days in recent years, reaching up to 121 days. This lengthening signifies increased time to convert investments in inventory and receivables into cash, indicating potential strain on liquidity.
Overall, the data indicates a gradual decline in operational efficiency, with significant increases in inventory holding and receivable collection periods leading to a longer operating and cash conversion cycle. While payables payment periods remain stable, the extended cash conversion cycle may warrant closer attention to working capital management.
Turnover Ratios
Average No. Days
Inventory Turnover
Monster Beverage Corp., inventory turnover calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||
| Cost of sales | 871,969) | 791,736) | 872,265) | 880,739) | 801,081) | 728,616) | 790,561) | 875,399) | 741,907) | 657,463) | 621,399) | 625,096) | 528,881) | 505,599) | 509,831) | 434,427) | 424,901) | 406,438) | 460,575) | 442,762) | 372,459) | |||||||
| Inventories | 939,630) | 971,406) | 883,582) | 846,812) | 906,723) | 935,631) | 862,977) | 885,948) | 821,132) | 593,357) | 471,553) | 382,890) | 368,402) | 333,085) | 318,956) | 340,536) | 352,305) | 360,731) | 317,745) | 299,529) | 300,780) | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Inventory turnover1 | 3.64 | 3.44 | 3.72 | 3.78 | 3.52 | 3.35 | 3.55 | 3.27 | 3.22 | 4.10 | 4.84 | 5.67 | 5.37 | 5.63 | 5.57 | 5.07 | 4.92 | 4.66 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Inventory Turnover, Competitors2 | ||||||||||||||||||||||||||||
| Coca-Cola Co. | 3.72 | 4.19 | 4.33 | 3.94 | 3.86 | 4.25 | 4.74 | 4.69 | 4.26 | 4.50 | 4.67 | 4.37 | 4.04 | 4.11 | — | — | — | — | — | — | — | |||||||
| Mondelēz International Inc. | 5.92 | 6.16 | 5.78 | 5.66 | 5.82 | 5.97 | 5.71 | 6.12 | 6.33 | 6.45 | 5.84 | 5.67 | 6.13 | 6.10 | — | — | — | — | — | — | — | |||||||
| PepsiCo Inc. | 7.57 | 7.85 | 7.59 | 7.01 | 7.22 | 7.77 | 7.83 | 7.26 | 7.95 | 8.53 | 8.11 | 6.82 | 7.10 | 7.62 | — | — | — | — | — | — | — | |||||||
| Philip Morris International Inc. | 1.31 | 1.20 | 1.31 | 1.25 | 1.10 | 1.15 | 1.54 | 1.41 | 1.19 | 1.15 | 1.20 | 1.11 | 1.05 | 1.00 | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2024 Calculation
Inventory turnover
= (Cost of salesQ1 2024
+ Cost of salesQ4 2023
+ Cost of salesQ3 2023
+ Cost of salesQ2 2023)
÷ Inventories
= (871,969 + 791,736 + 872,265 + 880,739)
÷ 939,630 = 3.64
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several notable trends in cost of sales, inventories, and inventory turnover ratios over the observed periods.
- Cost of Sales
- The cost of sales shows an overall upward trend across most quarters. Starting from approximately 372 million US dollars in March 2019, it increased steadily, reaching a peak of around 880 million US dollars in the third quarter of 2023. There was some fluctuation, particularly during 2022 and early 2023, where the cost of sales declined slightly in the fourth quarter of 2022 before increasing again. The data reflects growth in operational expenses related to goods sold, indicating either increased sales volume, higher input costs, or a combination of both.
- Inventories
- Inventories exhibited a consistent increase over the periods analyzed. Beginning near 300 million US dollars in the first quarter of 2019, inventory levels rose significantly, reaching nearly 972 million US dollars by the fourth quarter of 2023. This increase could suggest expansion in production or stockpiling efforts. Notably, inventories surged sharply from 593 million in the fourth quarter of 2021 to over 885 million in the second quarter of 2022, indicating aggressive inventory build-up during this period. Although there is some quarterly variability, the general direction is upward, reflecting higher capital tied up in inventory.
- Inventory Turnover Ratio
- The inventory turnover ratio fluctuated throughout the periods, demonstrating a declining trend from early 2020 levels. Initially, the ratio was relatively strong, forming a range of about 4.66 to 5.67 times per year through 2019 and 2020, suggesting efficient inventory management and sales conversion. However, from late 2021 onwards, this ratio declined to a range between approximately 3.22 and 3.78, indicating a slower turnover rate. The reduction in inventory turnover suggests that inventory is increasing faster than the cost of sales, possibly pointing to slower sales absorption or increased inventory holding periods.
Receivables Turnover
Monster Beverage Corp., receivables turnover calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||
| Net sales | 1,899,098) | 1,730,108) | 1,856,028) | 1,854,961) | 1,698,930) | 1,512,930) | 1,624,286) | 1,655,260) | 1,518,574) | 1,425,045) | 1,410,557) | 1,461,934) | 1,243,816) | 1,196,283) | 1,246,362) | 1,093,896) | 1,062,097) | 1,017,206) | 1,133,577) | 1,104,045) | 945,991) | |||||||
| Accounts receivable, net | 1,370,239) | 1,193,964) | 1,231,188) | 1,333,004) | 1,190,351) | 1,016,203) | 1,051,642) | 1,175,587) | 1,039,780) | 896,658) | 849,157) | 909,169) | 802,509) | 666,012) | 740,813) | 760,433) | 670,570) | 540,330) | 647,983) | 688,197) | 596,661) | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Receivables turnover1 | 5.36 | 5.98 | 5.62 | 5.02 | 5.45 | 6.21 | 5.92 | 5.11 | 5.59 | 6.18 | 6.26 | 5.66 | 5.96 | 6.90 | 5.97 | 5.66 | 6.44 | 7.77 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Receivables Turnover, Competitors2 | ||||||||||||||||||||||||||||
| Coca-Cola Co. | 10.86 | 13.42 | 12.88 | 11.12 | 9.46 | 12.33 | 10.60 | 9.19 | 8.65 | 11.01 | 9.72 | 9.02 | 8.89 | 10.50 | — | — | — | — | — | — | — | |||||||
| Mondelēz International Inc. | 9.04 | 9.91 | 10.12 | 11.63 | 9.39 | 10.20 | 10.80 | 12.11 | 9.94 | 12.29 | 10.61 | 12.51 | 10.21 | 11.57 | — | — | — | — | — | — | — | |||||||
| PepsiCo Inc. | 8.40 | 8.46 | 7.78 | 7.87 | 8.41 | 8.50 | 7.79 | 7.80 | 8.58 | 9.16 | 8.03 | 7.67 | 8.03 | 8.37 | — | — | — | — | — | — | — | |||||||
| Philip Morris International Inc. | 8.58 | 10.16 | 8.81 | 8.07 | 8.80 | 8.25 | 8.21 | 8.32 | 8.65 | 10.06 | 9.10 | 8.50 | 8.82 | 9.88 | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2024 Calculation
Receivables turnover
= (Net salesQ1 2024
+ Net salesQ4 2023
+ Net salesQ3 2023
+ Net salesQ2 2023)
÷ Accounts receivable, net
= (1,899,098 + 1,730,108 + 1,856,028 + 1,854,961)
÷ 1,370,239 = 5.36
2 Click competitor name to see calculations.
The quarterly financial data for the period under review demonstrates notable variations in net sales, accounts receivable, and receivables turnover ratios.
- Net Sales
- Net sales generally exhibit an upward trend with fluctuations across quarters. Beginning at $945.99 million in Q1 2019, net sales rose steadily, reaching a peak of $1.655 billion in Q2 2022. Following this peak, net sales experienced some volatility, with amounts varying between $1.512 billion and $1.859 billion during the subsequent quarters. The latest reported figure for Q1 2024 shows net sales at approximately $1.899 billion, marking a recovery from dips in the prior year and indicating strong sales momentum.
- Accounts Receivable, Net
- The accounts receivable balances show an overall increasing trend, mirroring the growth in net sales but with some lag and variability. Starting from $596.66 million in Q1 2019, receivables expanded significantly to $1.176 billion by Q2 2022. After this peak, accounts receivable declined somewhat but remained elevated, ending at approximately $1.370 billion in Q1 2024. The rise in receivables suggests higher credit sales or extended payment terms associated with increased revenue, while the slight decline in recent quarters may reflect improved collections or changes in credit policy.
- Receivables Turnover Ratio
- The receivables turnover ratio depicts a fluctuating but overall declining trend over the periods measured. From a ratio of 7.77 in Q1 2019, it decreased to a low of 5.02 in Q2 2023 before partially recovering to 5.36 in Q1 2024. Lower turnover ratios indicate that accounts receivable are turning over less frequently, implying longer collection periods or increased credit terms. The decline suggests potential challenges in collecting receivables promptly amid growing sales volumes.
In summary, the data indicate robust growth in net sales accompanied by rising accounts receivable balances. However, the decreasing receivables turnover ratio signals a need for close monitoring of credit and collection policies to maintain cash flow efficiency as sales expand.
Payables Turnover
Monster Beverage Corp., payables turnover calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||
| Cost of sales | 871,969) | 791,736) | 872,265) | 880,739) | 801,081) | 728,616) | 790,561) | 875,399) | 741,907) | 657,463) | 621,399) | 625,096) | 528,881) | 505,599) | 509,831) | 434,427) | 424,901) | 406,438) | 460,575) | 442,762) | 372,459) | |||||||
| Accounts payable | 533,729) | 564,379) | 539,892) | 568,613) | 491,249) | 444,265) | 520,198) | 492,858) | 438,256) | 404,263) | 396,229) | 362,900) | 334,076) | 296,800) | 281,522) | 261,969) | 305,529) | 274,045) | 304,773) | 292,627) | 267,735) | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Payables turnover1 | 6.40 | 5.93 | 6.08 | 5.63 | 6.51 | 7.06 | 5.89 | 5.88 | 6.04 | 6.02 | 5.76 | 5.98 | 5.92 | 6.32 | 6.31 | 6.59 | 5.68 | 6.14 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Payables Turnover, Competitors2 | ||||||||||||||||||||||||||||
| Mondelēz International Inc. | 2.45 | 2.67 | 2.88 | 2.80 | 2.68 | 2.67 | 2.88 | 2.74 | 2.48 | 2.60 | 2.63 | 2.60 | 2.53 | 2.60 | — | — | — | — | — | — | — | |||||||
| Philip Morris International Inc. | 3.58 | 3.11 | 3.58 | 3.28 | 3.00 | 2.80 | 3.29 | 3.25 | 3.24 | 3.01 | 3.49 | 3.66 | 3.72 | 3.44 | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2024 Calculation
Payables turnover
= (Cost of salesQ1 2024
+ Cost of salesQ4 2023
+ Cost of salesQ3 2023
+ Cost of salesQ2 2023)
÷ Accounts payable
= (871,969 + 791,736 + 872,265 + 880,739)
÷ 533,729 = 6.40
2 Click competitor name to see calculations.
- Cost of Sales
- The cost of sales exhibited a generally rising trend over the analyzed periods from March 31, 2019, through March 31, 2024. Starting at approximately $372 million in early 2019, costs increased nearly consistently, peaking around $875 million in June 2022. Following this peak, there was a noticeable decline towards the end of 2022, with costs dropping below $729 million by December 31, 2022. In 2023, costs generally trended upwards again, reaching nearly $872 million by March 31, 2024. This pattern indicates a significant growth in cost levels over five years, with some volatility in the latter part of 2022.
- Accounts Payable
- Accounts payable demonstrated a clear upward trajectory during the period reviewed. Beginning at approximately $268 million in March 2019, accounts payable increased steadily to exceed $520 million by September 2022. Despite some fluctuations in late 2022 and early 2023, the balance remained elevated through March 2024, closing around $534 million. This growth suggests an increasing reliance on supplier credit or longer payment terms in recent years, consistent with the rising cost of sales.
- Payables Turnover Ratio
- The payables turnover ratio data, which is available from March 2020 onwards, indicates some variability but generally centers around a range of approximately 5.6 to 7.1. The highest observed ratio was 7.06 in March 2023, indicating faster payments to suppliers during that quarter. Conversely, dips to approximately 5.6 or 5.9 suggest slower turnover at other times. The fluctuations in the payables turnover ratio suggest changes in payment policies or supplier negotiations, with no clear long-term trend toward faster or slower payments, but rather oscillation within a moderate range.
- Overall Analysis
- The financial data reveals a consistent increase in the absolute figures for both cost of sales and accounts payable over the five-year span, reflecting the company's growth and scale of operations. The volatility in the cost of sales around late 2022 may indicate inventory management adjustments or cost pressures. The accounts payable growth parallels the increased costs, suggesting extended payment terms or larger procurement volumes. The relatively stable payables turnover ratio implies that despite rising costs and payables, the company maintains a consistent approach to supplier payment timing, balancing operational cash flow needs without extreme shifts in payment speed.
Working Capital Turnover
Monster Beverage Corp., working capital turnover calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||
| Current assets | 6,035,514) | 5,588,996) | 5,311,515) | 5,654,113) | 5,294,609) | 4,764,897) | 4,696,691) | 4,696,620) | 4,743,666) | 4,682,110) | 4,383,673) | 3,950,675) | 3,433,872) | 3,140,955) | 2,825,847) | 2,371,450) | 2,048,722) | 2,316,309) | 2,360,760) | 2,326,768) | 1,907,300) | |||||||
| Less: Current liabilities | 1,228,828) | 1,161,689) | 1,178,802) | 1,162,580) | 1,187,511) | 1,001,978) | 1,121,717) | 1,093,608) | 1,044,361) | 965,076) | 932,240) | 887,527) | 788,861) | 749,988) | 773,763) | 674,865) | 701,541) | 661,097) | 714,216) | 705,500) | 630,972) | |||||||
| Working capital | 4,806,686) | 4,427,307) | 4,132,713) | 4,491,533) | 4,107,098) | 3,762,919) | 3,574,974) | 3,603,012) | 3,699,305) | 3,717,034) | 3,451,433) | 3,063,148) | 2,645,011) | 2,390,967) | 2,052,084) | 1,696,585) | 1,347,181) | 1,655,212) | 1,646,544) | 1,621,268) | 1,276,328) | |||||||
| Net sales | 1,899,098) | 1,730,108) | 1,856,028) | 1,854,961) | 1,698,930) | 1,512,930) | 1,624,286) | 1,655,260) | 1,518,574) | 1,425,045) | 1,410,557) | 1,461,934) | 1,243,816) | 1,196,283) | 1,246,362) | 1,093,896) | 1,062,097) | 1,017,206) | 1,133,577) | 1,104,045) | 945,991) | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Working capital turnover1 | 1.53 | 1.61 | 1.68 | 1.49 | 1.58 | 1.68 | 1.74 | 1.67 | 1.57 | 1.49 | 1.54 | 1.68 | 1.81 | 1.92 | 2.15 | 2.54 | 3.20 | 2.54 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Working Capital Turnover, Competitors2 | ||||||||||||||||||||||||||||
| Coca-Cola Co. | 41.66 | 14.47 | 13.02 | 12.70 | 12.35 | 15.00 | 15.68 | 15.83 | 11.91 | 14.90 | 4.58 | 5.07 | 6.14 | 7.12 | — | — | — | — | — | — | — | |||||||
| Mondelēz International Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| PepsiCo Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Philip Morris International Inc. | — | — | — | — | — | — | — | — | — | — | — | 10.52 | 10.81 | 15.29 | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2024 Calculation
Working capital turnover
= (Net salesQ1 2024
+ Net salesQ4 2023
+ Net salesQ3 2023
+ Net salesQ2 2023)
÷ Working capital
= (1,899,098 + 1,730,108 + 1,856,028 + 1,854,961)
÷ 4,806,686 = 1.53
2 Click competitor name to see calculations.
- Working Capital
- Working capital exhibited a generally upward trend from March 2019 through March 2024. Starting at approximately 1,276,328 thousand USD in March 2019, it increased steadily with periodic fluctuations, reaching about 4,806,686 thousand USD by March 2024. There were notable increases in the quarters ending June 2020 to December 2020, and again from March 2023 to December 2023, indicating potential growth in short-term assets relative to liabilities during these periods. However, slight declines were observed in mid-2022 and mid-2023, suggesting transient reductions in liquidity or asset management in those quarters.
- Net Sales
- Net sales showed a generally rising trend across the periods, increasing from around 945,991 thousand USD in March 2019 to approximately 1,899,098 thousand USD in March 2024. Despite some quarterly volatility, such as a dip in sales during December 2019 and December 2022, overall net sales maintained a progressive upward trajectory. The highest sales figures were mostly recorded in mid-2021 through mid-2023, with values frequently exceeding 1.6 million thousand USD, reflecting strong revenue generation. The data suggest resilience with recovery following sales dips, visible from rebounds in subsequent quarters.
- Working Capital Turnover
- This ratio, which measures the efficiency of working capital use in generating sales, trended downward from 2.54 in December 2019 to a low point around 1.49 in December 2021, indicating decreasing sales generated per unit of working capital during this interval. After this period, there was a moderate recovery and stabilization in the ratio, fluctuating between 1.49 and 1.74 through March 2024. This pattern suggests that although working capital increased substantially, the proportional increase in sales did not keep pace initially, but efficiency improved moderately in later periods.
- Summary of Trends
- The data indicate that the company experienced significant growth in working capital and net sales over the five-year span. Working capital rose markedly faster than sales, particularly from 2019 through 2021, contributing to a reduced turnover ratio. This may reflect increased investments in current assets or changes in working capital components, potentially to support expansion or operational adjustments. Subsequently, the stabilization and slight improvement in working capital turnover from 2022 onward suggest a more balanced relationship between capital investment and sales output. The fluctuations in net sales also reveal some seasonal or market influences but overall depict a strong revenue growth trajectory. The trends underscore a strategic focus on liquidity and capacity to generate sales, although continuous monitoring of turnover efficiency remains essential for optimizing capital utilization.
Average Inventory Processing Period
Monster Beverage Corp., average inventory processing period calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||||||||||||||||
| Inventory turnover | 3.64 | 3.44 | 3.72 | 3.78 | 3.52 | 3.35 | 3.55 | 3.27 | 3.22 | 4.10 | 4.84 | 5.67 | 5.37 | 5.63 | 5.57 | 5.07 | 4.92 | 4.66 | — | — | — | |||||||
| Short-term Activity Ratio (no. days) | ||||||||||||||||||||||||||||
| Average inventory processing period1 | 100 | 106 | 98 | 97 | 104 | 109 | 103 | 112 | 113 | 89 | 75 | 64 | 68 | 65 | 66 | 72 | 74 | 78 | — | — | — | |||||||
| Benchmarks (no. days) | ||||||||||||||||||||||||||||
| Average Inventory Processing Period, Competitors2 | ||||||||||||||||||||||||||||
| Coca-Cola Co. | 98 | 87 | 84 | 93 | 95 | 86 | 77 | 78 | 86 | 81 | 78 | 84 | 90 | 89 | — | — | — | — | — | — | — | |||||||
| Mondelēz International Inc. | 62 | 59 | 63 | 65 | 63 | 61 | 64 | 60 | 58 | 57 | 62 | 64 | 60 | 60 | — | — | — | — | — | — | — | |||||||
| PepsiCo Inc. | 48 | 46 | 48 | 52 | 51 | 47 | 47 | 50 | 46 | 43 | 45 | 54 | 51 | 48 | — | — | — | — | — | — | — | |||||||
| Philip Morris International Inc. | 279 | 305 | 278 | 291 | 330 | 316 | 237 | 259 | 306 | 317 | 305 | 330 | 349 | 366 | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2024 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 3.64 = 100
2 Click competitor name to see calculations.
The data reveals a clear downward trend in inventory turnover ratios starting from the first available figure in March 31, 2020, through March 31, 2024. Initially, the inventory turnover ratio increased from 4.66 to a peak of 5.67 by September 30, 2020, indicating a more efficient use of inventory during that period. However, following this peak, the ratio exhibits a declining trend, dropping significantly to 3.64 by March 31, 2024. This suggests a gradual decrease in the efficiency of inventory usage over the latter time frame.
In parallel, the average inventory processing period highlights an inverse relationship to the inventory turnover ratio, as expected. Starting at 78 days in March 31, 2020, the processing period initially declines to 64 days by September 30, 2020, consistent with the rise in turnover ratio. After this low point, the number of days required to process inventory steadily increases, reaching a high of 113 days by June 30, 2022. Following this peak, the inventory processing days moderately decline but remain relatively elevated, settling at 100 days by March 31, 2024.
Overall, during the period from 2020 to 2024, there is evidence of a deterioration in inventory management efficiency. The initial improvement seen in mid-2020 is reversed, with turnover slowing and inventory holding periods increasing. This trend may indicate challenges in inventory movement or demand fluctuations impacting turnover rates in more recent quarters.
- Inventory Turnover Ratio Trends
- Peaked at 5.67 in Q3 2020, followed by a steady decline to 3.64 by Q1 2024.
- Average Inventory Processing Period Trends
- Decreased initially to 64 days by Q3 2020, then increased sharply to 113 days in Q2 2022 before somewhat stabilizing around 100 days.
- Interpretation
- Since mid-2020, an overall reduction in inventory turnover efficiency is observed alongside longer inventory holding periods, potentially signifying supply chain or demand management issues.
Average Receivable Collection Period
Monster Beverage Corp., average receivable collection period calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||||||||||||||||
| Receivables turnover | 5.36 | 5.98 | 5.62 | 5.02 | 5.45 | 6.21 | 5.92 | 5.11 | 5.59 | 6.18 | 6.26 | 5.66 | 5.96 | 6.90 | 5.97 | 5.66 | 6.44 | 7.77 | — | — | — | |||||||
| Short-term Activity Ratio (no. days) | ||||||||||||||||||||||||||||
| Average receivable collection period1 | 68 | 61 | 65 | 73 | 67 | 59 | 62 | 71 | 65 | 59 | 58 | 64 | 61 | 53 | 61 | 64 | 57 | 47 | — | — | — | |||||||
| Benchmarks (no. days) | ||||||||||||||||||||||||||||
| Average Receivable Collection Period, Competitors2 | ||||||||||||||||||||||||||||
| Coca-Cola Co. | 34 | 27 | 28 | 33 | 39 | 30 | 34 | 40 | 42 | 33 | 38 | 40 | 41 | 35 | — | — | — | — | — | — | — | |||||||
| Mondelēz International Inc. | 40 | 37 | 36 | 31 | 39 | 36 | 34 | 30 | 37 | 30 | 34 | 29 | 36 | 32 | — | — | — | — | — | — | — | |||||||
| PepsiCo Inc. | 43 | 43 | 47 | 46 | 43 | 43 | 47 | 47 | 43 | 40 | 45 | 48 | 45 | 44 | — | — | — | — | — | — | — | |||||||
| Philip Morris International Inc. | 43 | 36 | 41 | 45 | 41 | 44 | 44 | 44 | 42 | 36 | 40 | 43 | 41 | 37 | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2024 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 5.36 = 68
2 Click competitor name to see calculations.
- Receivables Turnover Ratio
- The receivables turnover ratio exhibits a declining trend beginning in March 2020, starting from 7.77 and decreasing consistently through several quarters. This decline reaches its lowest point around June and September 2023, with values near 5.02 and 5.36 respectively. Though there is some fluctuation, with a modest recovery in a few quarters such as December 2020 (5.97) and March 2024 (5.36), the general pattern suggests a reduction in the frequency with which receivables are collected over the period analyzed.
- Average Receivable Collection Period
- Conversely, the average receivable collection period shows an increasing trend over the same timeframe. Starting with 47 days in March 2020, the number of days rises to a peak around September 2023 at approximately 73 days. This indicates a lengthening of the time customers take to pay receivables. While minor decreases occur in some quarters, the overall direction reflects a slower conversion of receivables into cash.
- Relationship Between Metrics
- The inverse relationship between the two metrics is evident: as the receivables turnover ratio declines, the average receivable collection period increases. This suggests that the company's efficiency in collecting receivables has diminished over the analyzed period, potentially impacting liquidity. The pattern signals the need for monitoring credit policies and collection processes to improve cash flow management.
Operating Cycle
Monster Beverage Corp., operating cycle calculation (quarterly data)
No. days
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||||||||||||||||
| Average inventory processing period | 100 | 106 | 98 | 97 | 104 | 109 | 103 | 112 | 113 | 89 | 75 | 64 | 68 | 65 | 66 | 72 | 74 | 78 | — | — | — | |||||||
| Average receivable collection period | 68 | 61 | 65 | 73 | 67 | 59 | 62 | 71 | 65 | 59 | 58 | 64 | 61 | 53 | 61 | 64 | 57 | 47 | — | — | — | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Operating cycle1 | 168 | 167 | 163 | 170 | 171 | 168 | 165 | 183 | 178 | 148 | 133 | 128 | 129 | 118 | 127 | 136 | 131 | 125 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Operating Cycle, Competitors2 | ||||||||||||||||||||||||||||
| Coca-Cola Co. | 132 | 114 | 112 | 126 | 134 | 116 | 111 | 118 | 128 | 114 | 116 | 124 | 131 | 124 | — | — | — | — | — | — | — | |||||||
| Mondelēz International Inc. | 102 | 96 | 99 | 96 | 102 | 97 | 98 | 90 | 95 | 87 | 96 | 93 | 96 | 92 | — | — | — | — | — | — | — | |||||||
| PepsiCo Inc. | 91 | 89 | 95 | 98 | 94 | 90 | 94 | 97 | 89 | 83 | 90 | 102 | 96 | 92 | — | — | — | — | — | — | — | |||||||
| Philip Morris International Inc. | 322 | 341 | 319 | 336 | 371 | 360 | 281 | 303 | 348 | 353 | 345 | 373 | 390 | 403 | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2024 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 100 + 68 = 168
2 Click competitor name to see calculations.
The data reveals notable fluctuations in the key efficiency metrics of the company over the analyzed periods. The average inventory processing period shows an overall increasing trend from 78 days in March 2020 to a peak of 113 days in March 2022, followed by some volatility and a slight decrease towards 100 days by March 2024. This indicates that inventory turnover slowed considerably, particularly through 2021 and early 2022, before partially recovering.
Similarly, the average receivable collection period exhibits an upward trend from 47 days in March 2020 to a high of 73 days in September 2023, with intermittent declines and rises. This suggests that the company experienced increasing delays in collecting accounts receivable over time, which may impact cash flow.
The operating cycle, which combines inventory processing and receivable collection periods, mirrors these trends. It initially rose from 125 days in March 2020 to a peak near 183 days in September 2022, reflecting an extended duration to convert inventory and receivables into cash. Although some improvement occurred afterward, the operating cycle remained elevated around 167-168 days towards early 2024, significantly longer than at the start of the period.
- Average Inventory Processing Period
- Generally increased from 78 days in early 2020 to a maximum of 113 days in March 2022, indicating slower inventory turnover.
- Experienced fluctuations with a moderate decline to about 100 days by March 2024, suggesting some efficiency gains late in the period.
- Average Receivable Collection Period
- Rose from 47 days in March 2020 to a peak of 73 days in September 2023, showing longer collection times.
- Presented some periodic decreases, but the overall trend points to a harder collection environment over the analyzed timeframe.
- Operating Cycle
- Increased from 125 days in early 2020, peaking around 183 days in September 2022, indicating a significantly extended cash conversion period.
- Showed marginal improvement thereafter but remained elevated at about 167-168 days in the most recent quarters.
In summary, the company’s operational efficiency, as measured by these metrics, declined markedly around 2021-2022, with slower inventory turnover and longer receivable collections leading to a protracted operating cycle. Although some recovery is evident toward early 2024, the figures suggest ongoing challenges in managing working capital efficiently.
Average Payables Payment Period
Monster Beverage Corp., average payables payment period calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||||||||||||||||
| Payables turnover | 6.40 | 5.93 | 6.08 | 5.63 | 6.51 | 7.06 | 5.89 | 5.88 | 6.04 | 6.02 | 5.76 | 5.98 | 5.92 | 6.32 | 6.31 | 6.59 | 5.68 | 6.14 | — | — | — | |||||||
| Short-term Activity Ratio (no. days) | ||||||||||||||||||||||||||||
| Average payables payment period1 | 57 | 62 | 60 | 65 | 56 | 52 | 62 | 62 | 60 | 61 | 63 | 61 | 62 | 58 | 58 | 55 | 64 | 59 | — | — | — | |||||||
| Benchmarks (no. days) | ||||||||||||||||||||||||||||
| Average Payables Payment Period, Competitors2 | ||||||||||||||||||||||||||||
| Mondelēz International Inc. | 149 | 136 | 127 | 131 | 136 | 137 | 127 | 133 | 147 | 141 | 139 | 140 | 144 | 140 | — | — | — | — | — | — | — | |||||||
| Philip Morris International Inc. | 102 | 117 | 102 | 111 | 122 | 130 | 111 | 112 | 113 | 121 | 105 | 100 | 98 | 106 | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2024 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 6.40 = 57
2 Click competitor name to see calculations.
- Payables Turnover Ratio
- The payables turnover ratio exhibits moderate fluctuations over the observed quarters starting from the period ending March 31, 2020. Initially, the ratio decreased from 6.14 to 5.68, indicating a slight slowdown in the rate at which payables are paid. This was followed by a rebound to 6.59 in September 2020, suggesting an improvement in payment efficiency. Subsequent quarters show minor oscillations around the range of approximately 5.8 to 6.3, with a notable peak at 7.06 in March 2023. The final two quarters demonstrate a slight decline and then a rise again, closing at 6.4 by March 31, 2024. Overall, the payables turnover ratio suggests relatively consistent management of payables, with intermittent periods of faster and slower payments.
- Average Payables Payment Period (Days)
- The average payables payment period ranged between approximately 52 and 65 days throughout the timeline. The initial values starting at 59 days in March 2020 increased to a peak of 64 days in June 2020, corresponding with a lower payables turnover during the same period. Following this, there is a downward trend reaching 52 days in March 2023, suggesting faster payments to suppliers during that quarter. However, the payment period again lengthened to around 65 days in September 2023 before decreasing to 57 days by March 2024. These changes inversely correlate with the payables turnover ratio trends and indicate varying working capital management strategies over time.
- Summary of Trends and Insights
- The company’s payables management shows stable dynamics with some volatility over the observed quarterly periods. Peaks and troughs in the payables turnover ratio correspond inversely to the average payment period, confirming the internal consistency of these measures. Periods of longer payment cycles tend to coincide with lower turnover ratios, implying strategic extensions of creditor terms or liquidity considerations. Conversely, shorter payment periods reflect more rapid settlement of liabilities, possibly due to improved cash flow or more aggressive working capital policies. The peak in payables turnover ratio in early 2023 and concurrent drop in payment days suggest heightened efficiency or changes in supplier payment conditions during that quarter.
Cash Conversion Cycle
Monster Beverage Corp., cash conversion cycle calculation (quarterly data)
No. days
| Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||||||||||||||||
| Average inventory processing period | 100 | 106 | 98 | 97 | 104 | 109 | 103 | 112 | 113 | 89 | 75 | 64 | 68 | 65 | 66 | 72 | 74 | 78 | — | — | — | |||||||
| Average receivable collection period | 68 | 61 | 65 | 73 | 67 | 59 | 62 | 71 | 65 | 59 | 58 | 64 | 61 | 53 | 61 | 64 | 57 | 47 | — | — | — | |||||||
| Average payables payment period | 57 | 62 | 60 | 65 | 56 | 52 | 62 | 62 | 60 | 61 | 63 | 61 | 62 | 58 | 58 | 55 | 64 | 59 | — | — | — | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Cash conversion cycle1 | 111 | 105 | 103 | 105 | 115 | 116 | 103 | 121 | 118 | 87 | 70 | 67 | 67 | 60 | 69 | 81 | 67 | 66 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Cash Conversion Cycle, Competitors2 | ||||||||||||||||||||||||||||
| Mondelēz International Inc. | -47 | -40 | -28 | -35 | -34 | -40 | -29 | -43 | -52 | -54 | -43 | -47 | -48 | -48 | — | — | — | — | — | — | — | |||||||
| Philip Morris International Inc. | 220 | 224 | 217 | 225 | 249 | 230 | 170 | 191 | 235 | 232 | 240 | 273 | 292 | 297 | — | — | — | — | — | — | — | |||||||
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q1 2024 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 100 + 68 – 57 = 111
2 Click competitor name to see calculations.
- Average Inventory Processing Period
- The average inventory processing period shows a generally increasing trend from 2019 through 2024. Starting at 66 days in December 2019, it decreased slightly to 64 days by September 2020 but then began to rise significantly. By December 2021, the period increased to 75 days and continued to grow, peaking at 113 days in June 2022. After this peak, it trended downward slightly but remained elevated, fluctuating between 97 and 109 days through early 2024. This indicates a lengthening time for inventory turnover, suggesting slower inventory movement or accumulation over the observed period.
- Average Receivable Collection Period
- The average receivable collection period fluctuated within the range of approximately 47 to 73 days during the periods observed. Initially, it increased from 47 days in March 2020 to a peak of 64 days by September 2019 and September 2020, before dropping slightly to 53 days in March 2021. From mid-2021 to mid-2022, the collection period generally increased, reaching a high of 73 days in September 2023, indicating a longer time to collect receivables. This volatility suggests variations in credit terms or collection efficiency, with a tendency toward slower collections in recent quarters.
- Average Payables Payment Period
- The average payables payment period exhibits moderate fluctuations around a mid-50s to low 60s range of days. It showed a mild increase from 55 days in September 2019 to a peak of 65 days in September 2023, with some quarters showing dips such as 52 days in March 2023. These changes indicate varying payment terms or cash management strategies but without a strong directional trend. The payment period generally maintained a consistent range, suggesting stable supplier payment practices.
- Cash Conversion Cycle
- The cash conversion cycle experienced considerable variation and a discernible upward trend from 2019 onward. Initially recorded at 66 days in June 2019, it increased gradually to 81 days by September 2019. After a slight decrease to 60 days in March 2021, it rose sharply through late 2021 and 2022, peaking at 121 days in September 2022. Although there was a slight reduction afterward, the cycle remained high, between 100 and 116 days through early 2024. This trend reflects a lengthening overall cash conversion process, caused primarily by increased inventory processing and receivables collection times, potentially impacting liquidity.