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)
Boston Scientific Corp., short-term (operating) activity ratios (quarterly data)
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
- Inventory Turnover
- The inventory turnover ratio shows a generally stable but slightly declining trend from early 2019 to early 2023. Starting at 2.41 in March 2019, the ratio decreased to a low of 1.91 by December 2018, then fluctuated around the range of 2.1 to 2.6. The ratio ended lower at 1.97 in March 2023, indicating a modest reduction in the frequency of inventory replacement over the periods observed.
- Receivables Turnover
- Receivables turnover exhibits fluctuations but maintains a narrow range between approximately 5.8 and 7.0 throughout the period. The ratio saw a moderate increase stronger than 6.8 in mid-2020, followed by some variance but stayed relatively stable, ending near 6.28 by March 2023. This level suggests consistent efficiency in collecting receivables over time, albeit with minor short-term variability.
- Payables Turnover
- Payables turnover demonstrates a declining pattern from early 2019, where it started at 8.06, falling generally until it reached about 4.59 by the end of 2022. There was a temporary peak in late 2020 reaching nearly 7.9 before resuming the downward trend. This indicates an elongation in the period taken to pay suppliers over recent years.
- Working Capital Turnover
- The working capital turnover ratio shows volatile changes with some extreme values. After an initial moderate period in early 2019, it surged to very high values such as 17.52 and 15.39 at specific points, then decreased significantly in other quarters to levels below 4. This high variability suggests irregularities or episodic changes in working capital efficiency.
- Average Inventory Processing Period
- The average inventory processing period experienced a gradual increase from 151 days in early 2019 to a peak of 191 days by the end of 2018. Thereafter, it fluctuated between 140 to 185 days, ending near 185 days in early 2023. This trend implies an overall lengthening in the time inventory remains held before processing.
- Average Receivable Collection Period
- The average receivable collection period stays fairly consistent, mostly between 52 and 63 days across the entire span, with minor quarter-to-quarter variations. This stability suggests consistent credit and collection policies throughout the periods analyzed.
- Operating Cycle
- The operating cycle lengthened notably from 211 days in early 2019 to a peak over 254 days by the end of the same year, then gradually shortened to around 198-243 days in later periods. Overall, the cycle remains long, implying the company holds inventory and collects receivables over extended periods before paying suppliers.
- Average Payables Payment Period
- The average payables payment period has generally increased from 45 days in early 2019 up to 80 days by late 2022, showing a consistent trend of delayed payments to creditors. Spikes and fluctuations are present but the overall direction is toward longer payment periods.
- Cash Conversion Cycle
- The cash conversion cycle displays a fluctuating pattern with an initial rise to 192 days by the end of 2018, followed by a decline to a low near 128 days in early 2021. Subsequently, it rose again to 165 days by early 2023. These fluctuations reflect the combined effects of inventory management, receivables collection, and payables payment, indicating variable cash flow timings throughout the years.
Turnover Ratios
Average No. Days
Inventory Turnover
Boston Scientific Corp., inventory turnover calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||
| Cost of products sold | 1,040) | 1,010) | 979) | 1,011) | 955) | 972) | 900) | 945) | 894) | 999) | 869) | 791) | 806) | 850) | 777) | 758) | 730) | 728) | 673) | 739) | 672) | |||||||
| Inventories | 2,050) | 1,867) | 1,788) | 1,752) | 1,736) | 1,610) | 1,603) | 1,430) | 1,407) | 1,351) | 1,472) | 1,516) | 1,628) | 1,579) | 1,566) | 1,300) | 1,228) | 1,166) | 1,134) | 1,087) | 1,113) | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Inventory turnover1 | 1.97 | 2.12 | 2.19 | 2.19 | 2.17 | 2.30 | 2.33 | 2.59 | 2.53 | 2.56 | 2.25 | 2.13 | 1.96 | 1.97 | 1.91 | 2.22 | 2.34 | 2.41 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Inventory Turnover, Competitors2 | ||||||||||||||||||||||||||||
| Abbott Laboratories | 2.77 | 3.10 | 3.37 | 3.24 | 3.36 | 3.59 | 3.47 | 3.27 | 2.99 | 2.99 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| CVS Health Corp. | 15.15 | 14.05 | 14.46 | 14.64 | 13.60 | 13.52 | 13.49 | 13.48 | 12.57 | 11.88 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Intuitive Surgical Inc. | 2.25 | 2.27 | 2.36 | 2.62 | 2.82 | 2.98 | 2.90 | 2.84 | 2.64 | 2.49 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Medtronic PLC | 2.09 | 2.20 | 2.26 | 2.38 | 2.47 | 2.43 | 2.24 | 2.20 | 2.10 | 2.23 | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q1 2023 Calculation
Inventory turnover
= (Cost of products soldQ1 2023
+ Cost of products soldQ4 2022
+ Cost of products soldQ3 2022
+ Cost of products soldQ2 2022)
÷ Inventories
= (1,040 + 1,010 + 979 + 1,011)
÷ 2,050 = 1.97
2 Click competitor name to see calculations.
The analyzed financial data reveals several notable trends in cost of products sold, inventories, and inventory turnover over the presented periods.
- Cost of Products Sold (USD in millions)
- This metric exhibits an overall upward trajectory from March 2018 through March 2023. Starting at 672 million USD in the first quarter of 2018, the cost increased progressively with some fluctuations, reaching as high as 1040 million USD by March 2023. Notable increments occurred particularly post-2019, with the cost consistently hovering around or above 900 million USD from 2020 onward, indicating rising expenses associated with product costs in recent years.
- Inventories (USD in millions)
- Inventories also display a substantial growth trend across the same timeframe. Beginning at 1113 million USD in March 2018, inventories experienced steady increases with intermittent periods of slight decline or stability. From 2019, the inventory levels rose more aggressively, peaking at 2050 million USD in March 2023. This steady buildup of inventories may reflect increased production capacity, stockpiling strategies, or adjustments in supply chain management.
- Inventory Turnover (ratio)
- Inventory turnover data, available starting only at December 2018, indicates fluctuating efficiency in inventory management. Initially recorded at 2.41, the ratio showed a declining trend through 2019, dipping to 1.91 by December of that year, suggesting slower movement of inventory relative to cost of goods sold. Following this low point, turnover improved again through 2020 and early 2021, peaking above 2.5, signifying more efficient inventory clearance. However, after this period, turnover ratios declined gradually to near 1.97 by March 2023, indicating a reduction in inventory efficiency relative to sales.
Overall, the company has experienced increasing costs and inventory levels over the observed periods, while inventory turnover has exhibited variable performance, with a general tendency towards decreased efficiency in recent quarters. The data suggests growth alongside potential challenges in inventory management and cost control that may warrant further operational review.
Receivables Turnover
Boston Scientific Corp., receivables turnover calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||
| Net sales | 3,389) | 3,242) | 3,170) | 3,244) | 3,026) | 3,127) | 2,932) | 3,077) | 2,752) | 2,708) | 2,659) | 2,003) | 2,543) | 2,904) | 2,707) | 2,631) | 2,493) | 2,561) | 2,393) | 2,490) | 2,379) | |||||||
| Trade accounts receivable, net | 2,076) | 1,970) | 1,871) | 1,917) | 1,866) | 1,778) | 1,669) | 1,675) | 1,631) | 1,531) | 1,598) | 1,457) | 1,577) | 1,828) | 1,796) | 1,712) | 1,621) | 1,608) | 1,580) | 1,587) | 1,580) | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Receivables turnover1 | 6.28 | 6.44 | 6.72 | 6.43 | 6.52 | 6.69 | 6.87 | 6.68 | 6.21 | 6.47 | 6.33 | 6.97 | 6.84 | 5.87 | 5.79 | 5.89 | 6.13 | 6.11 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Receivables Turnover, Competitors2 | ||||||||||||||||||||||||||||
| Abbott Laboratories | 6.89 | 7.02 | 7.03 | 6.33 | 6.20 | 6.64 | 6.61 | 6.58 | 6.13 | 5.40 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| CVS Health Corp. | 11.65 | 11.79 | 11.94 | 11.27 | 11.30 | 11.91 | 11.23 | 11.48 | 11.32 | 12.32 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Elevance Health Inc. | 16.53 | 18.81 | 19.51 | 18.80 | 16.67 | 20.66 | 18.93 | 18.81 | 17.39 | 19.72 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Intuitive Surgical Inc. | 6.95 | 6.60 | 7.20 | 7.11 | 6.52 | 7.30 | 7.90 | 7.38 | 6.96 | 6.75 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Medtronic PLC | 5.85 | 5.71 | 5.84 | 5.79 | 5.82 | 5.51 | 5.35 | 5.21 | 5.73 | 6.22 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| UnitedHealth Group Inc. | 14.88 | 18.22 | 18.37 | 16.27 | 15.65 | 20.07 | 19.60 | 18.53 | 16.35 | 19.86 | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q1 2023 Calculation
Receivables turnover
= (Net salesQ1 2023
+ Net salesQ4 2022
+ Net salesQ3 2022
+ Net salesQ2 2022)
÷ Trade accounts receivable, net
= (3,389 + 3,242 + 3,170 + 3,244)
÷ 2,076 = 6.28
2 Click competitor name to see calculations.
- Net Sales
-
Net sales exhibited a generally upward trend over the analyzed periods. Starting at 2,379 million USD in the first quarter of 2018, sales increased steadily through 2019, peaking close to 2,904 million USD at the end of that year. However, there was a notable decline in the first half of 2020, corresponding presumably to external or market conditions impacting performance, with sales dropping to about 2,003 million USD in the second quarter of 2020. Following this dip, net sales recovered and resumed growth, surpassing the pre-downturn levels by the first quarter of 2021 and reaching 3,389 million USD by the first quarter of 2023, reflecting a strong upward trajectory in recent quarters.
- Trade Accounts Receivable, Net
-
The trade accounts receivable, net, mirrored some of the fluctuations seen in net sales but with a more consistent upward progression over the entire period. Beginning at 1,580 million USD in the first quarter of 2018, receivables saw incremental increases through 2019, touching 1,828 million USD by year-end. The figure dropped somewhat during 2020's first half, aligning with decreased sales, but resumed growth afterward, reaching 2,076 million USD by the first quarter of 2023. This pattern suggests effective credit management during sales fluctuations, with receivables increasing in line with sales expansion over time.
- Receivables Turnover Ratio
-
The receivables turnover ratio, available from the second quarter of 2018 onward, exhibited some variability but remained within a stable range. Early ratios in 2018 and 2019 hovered around 5.79 to 6.13, indicating consistent collections relative to credit sales. During the first half of 2020, coinciding with the decline in sales, the turnover ratio temporarily increased to 6.84 and 6.97, suggesting faster collections or potentially tighter credit terms amid challenging conditions. In subsequent quarters, the ratio adjusted downwards but stayed within the 6.28 to 6.87 band, indicative of maintained efficiency in accounts receivable management despite varying sales volumes.
- Summary of Insights
-
Overall, the data reflect a company experiencing solid growth in net sales over the analyzed five-year period, with a temporary disruption in 2020 followed by a robust recovery. Trade accounts receivable increased consistently, suggesting scaling operations and effective credit policies aligned with sales trends. The relatively stable receivables turnover ratio supports the conclusion that the collection process remained efficient throughout fluctuations in sales volume. These patterns imply sound operational management and resilience in revenue generation and cash conversion cycles amid varying market conditions.
Payables Turnover
Boston Scientific Corp., payables turnover calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||
| Cost of products sold | 1,040) | 1,010) | 979) | 1,011) | 955) | 972) | 900) | 945) | 894) | 999) | 869) | 791) | 806) | 850) | 777) | 758) | 730) | 728) | 673) | 739) | 672) | |||||||
| Accounts payable | 868) | 862) | 803) | 732) | 696) | 794) | 674) | 689) | 615) | 513) | 452) | 408) | 605) | 542) | 512) | 524) | 498) | 349) | 453) | 403) | 404) | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Payables turnover1 | 4.65 | 4.59 | 4.88 | 5.24 | 5.42 | 4.67 | 5.55 | 5.38 | 5.78 | 6.75 | 7.34 | 7.90 | 5.27 | 5.75 | 5.85 | 5.51 | 5.76 | 8.06 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Payables Turnover, Competitors2 | ||||||||||||||||||||||||||||
| Abbott Laboratories | 4.44 | 4.15 | 4.67 | 4.25 | 4.02 | 4.21 | 4.55 | 4.43 | 3.97 | 3.80 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| CVS Health Corp. | 22.08 | 18.07 | 18.75 | 19.22 | 19.38 | 19.14 | 18.49 | 20.72 | 20.50 | 19.72 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Elevance Health Inc. | 7.57 | 7.47 | 7.48 | 7.35 | 7.28 | 7.59 | 7.31 | 7.30 | 7.31 | 7.75 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Intuitive Surgical Inc. | 12.99 | 13.78 | 12.01 | 12.68 | 14.36 | 14.45 | 14.13 | 13.71 | 14.80 | 18.35 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Medtronic PLC | 4.62 | 4.46 | 5.14 | 5.41 | 5.67 | 4.98 | 5.56 | 5.19 | 5.56 | 4.72 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| UnitedHealth Group Inc. | 6.86 | 7.26 | 7.07 | 6.90 | 6.78 | 7.63 | 6.98 | 6.97 | 6.58 | 7.29 | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q1 2023 Calculation
Payables turnover
= (Cost of products soldQ1 2023
+ Cost of products soldQ4 2022
+ Cost of products soldQ3 2022
+ Cost of products soldQ2 2022)
÷ Accounts payable
= (1,040 + 1,010 + 979 + 1,011)
÷ 868 = 4.65
2 Click competitor name to see calculations.
- Cost of Products Sold
- The cost of products sold demonstrates an overall upward trend throughout the observed periods. Starting at 672 million US dollars in the first quarter of 2018, it gradually increased with some fluctuations, reaching 1040 million US dollars by the first quarter of 2023. Notable moderate increases are visible at the end of 2020 and again during 2022, indicating rising production or procurement costs.
- Accounts Payable
- Accounts payable exhibits notable variability but maintains an upward movement over the period. The value starts at 404 million US dollars in March 2018 and climbs to 868 million US dollars by March 2023. Periodic decreases interrupt the general rise, such as the dip in June 2020, followed by a steady increase peaking again toward the end of the dataset. This pattern may indicate fluctuations in payment cycles or changes in supplier credit terms.
- Payables Turnover Ratio
- The payables turnover ratio, which measures how often the company pays its suppliers during a period, reveals a declining trend. Early values were higher, around 8.06 in the third quarter of 2018, then generally decreased over time, reaching values below 5 by 2023. This decline indicates that the company is taking longer to pay its suppliers as time progresses. Variability exists within the timeframe, but the downward trend is clear, possibly reflecting changes in cash management or supplier negotiation strategies.
Working Capital Turnover
Boston Scientific Corp., working capital turnover calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||
| Current assets | 5,704) | 5,760) | 5,144) | 5,083) | 5,065) | 6,317) | 6,229) | 6,758) | 6,101) | 6,694) | 6,160) | 5,803) | 4,823) | 4,699) | 4,847) | 6,334) | 6,234) | 4,003) | 3,971) | 3,929) | 4,080) | |||||||
| Less: Current liabilities | 4,083) | 3,803) | 3,549) | 3,883) | 4,275) | 4,274) | 4,022) | 4,073) | 3,393) | 3,681) | 3,302) | 3,108) | 3,976) | 4,866) | 4,254) | 4,850) | 4,479) | 5,260) | 5,082) | 4,753) | 4,988) | |||||||
| Working capital | 1,621) | 1,957) | 1,595) | 1,200) | 790) | 2,043) | 2,207) | 2,685) | 2,708) | 3,013) | 2,858) | 2,695) | 847) | (167) | 593) | 1,484) | 1,755) | (1,257) | (1,111) | (824) | (908) | |||||||
| Net sales | 3,389) | 3,242) | 3,170) | 3,244) | 3,026) | 3,127) | 2,932) | 3,077) | 2,752) | 2,708) | 2,659) | 2,003) | 2,543) | 2,904) | 2,707) | 2,631) | 2,493) | 2,561) | 2,393) | 2,490) | 2,379) | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Working capital turnover1 | 8.05 | 6.48 | 7.88 | 10.27 | 15.39 | 5.82 | 5.20 | 4.17 | 3.74 | 3.29 | 3.54 | 3.77 | 12.73 | — | 17.52 | 6.79 | 5.66 | — | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Working Capital Turnover, Competitors2 | ||||||||||||||||||||||||||||
| Abbott Laboratories | 4.21 | 4.48 | 3.92 | 3.63 | 4.13 | 3.87 | 3.98 | 4.02 | 3.99 | 4.06 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| CVS Health Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Elevance Health Inc. | 7.60 | 8.37 | 9.11 | 8.85 | 8.65 | 7.23 | 6.79 | 6.67 | 5.38 | 6.39 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Intuitive Surgical Inc. | 1.15 | 1.29 | 1.21 | 1.17 | 1.26 | 1.22 | 1.17 | 1.03 | 0.88 | 0.77 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Medtronic PLC | 3.84 | 2.97 | 2.21 | 2.13 | 2.15 | 2.15 | 2.02 | 2.00 | 2.44 | 2.48 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| UnitedHealth Group Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q1 2023 Calculation
Working capital turnover
= (Net salesQ1 2023
+ Net salesQ4 2022
+ Net salesQ3 2022
+ Net salesQ2 2022)
÷ Working capital
= (3,389 + 3,242 + 3,170 + 3,244)
÷ 1,621 = 8.05
2 Click competitor name to see calculations.
- Working Capital
- The working capital figures demonstrate considerable volatility over the analyzed periods. From March 2018 through December 2018, working capital was negative and declining, reaching its lowest point at -1,257 million US dollars. Beginning in the first quarter of 2019, a sharp reversal occurred with working capital turning positive and peaking at 1,755 million US dollars in March 2019. Afterward, there was a general downward trend through the end of 2019, dipping negative briefly in December 2019 (-167 million US dollars). Subsequently, working capital increased significantly from early 2020 onward, reaching above 3,000 million US dollars in late 2020, before gradually decreasing to 1,621 million US dollars by March 2023.
- Net Sales
- Net sales exhibited a generally upward trend throughout the period, with some variability likely reflecting seasonality or market conditions. From 2,379 million US dollars in March 2018, sales increased steadily to 2,904 million US dollars by December 2019. However, the first half of 2020 saw a noticeable dip, with sales falling to approximately 2,003 million US dollars in June 2020, possibly indicative of disruption or reduced demand during that period. Sales rebounded strongly starting in the third quarter of 2020, surpassing previous highs and maintaining a rising trajectory through early 2023. The highest recorded net sales were 3,389 million US dollars in March 2023, emphasizing a sustained recovery and growth.
- Working Capital Turnover
- The working capital turnover ratio, available intermittently, shows high variability across the quarters. The ratio spiked dramatically starting in mid-2019, with figures such as 17.52 and 12.73 in late 2019 and early 2020, which suggests increased efficiency in utilizing working capital to generate sales during those periods. The ratio then declined to a range between approximately 3.29 and 5.82 through much of 2020 and 2021, indicating moderate efficiency. In late 2021, turnover surged again significantly, reaching up to 15.39 in September 2022, before moderating to around 8.05 by March 2023. These fluctuations reflect changes in the relationship between sales and working capital levels, possibly impacted by shifts in inventory management, receivables, or payables policies.
Average Inventory Processing Period
Boston Scientific Corp., average inventory processing period calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||||||||||||||||
| Inventory turnover | 1.97 | 2.12 | 2.19 | 2.19 | 2.17 | 2.30 | 2.33 | 2.59 | 2.53 | 2.56 | 2.25 | 2.13 | 1.96 | 1.97 | 1.91 | 2.22 | 2.34 | 2.41 | — | — | — | |||||||
| Short-term Activity Ratio (no. days) | ||||||||||||||||||||||||||||
| Average inventory processing period1 | 185 | 172 | 167 | 167 | 168 | 158 | 157 | 141 | 145 | 142 | 162 | 172 | 186 | 185 | 191 | 164 | 156 | 151 | — | — | — | |||||||
| Benchmarks (no. days) | ||||||||||||||||||||||||||||
| Average Inventory Processing Period, Competitors2 | ||||||||||||||||||||||||||||
| Abbott Laboratories | 132 | 118 | 108 | 113 | 109 | 102 | 105 | 111 | 122 | 122 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| CVS Health Corp. | 24 | 26 | 25 | 25 | 27 | 27 | 27 | 27 | 29 | 31 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Intuitive Surgical Inc. | 162 | 161 | 155 | 139 | 130 | 122 | 126 | 129 | 138 | 147 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Medtronic PLC | 174 | 166 | 161 | 153 | 148 | 150 | 163 | 166 | 174 | 164 | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q1 2023 Calculation
Average inventory processing period = 365 ÷ Inventory turnover
= 365 ÷ 1.97 = 185
2 Click competitor name to see calculations.
The analysis of the inventory turnover ratio and the average inventory processing period over the observed quarters reveals notable trends in inventory management efficiency.
- Inventory Turnover Ratio
- The inventory turnover ratio data begins from the first quarter of 2019. Initially, the ratio showed a declining trend from 2.41 in Q1 2019 to a low of 1.91 in Q4 2019, indicating a slower rate of inventory turnover during this period. The ratio remained relatively stable around 1.96 to 2.25 throughout 2020, followed by an improvement in early 2021 with values peaking at 2.59 in Q1 2021. Subsequently, the ratio stabilized between 2.17 and 2.33 for most of 2021 and early 2022. However, from mid-2022 onwards, there was a gradual decline again, reaching 1.97 by Q1 2023. This fluctuation suggests variability in how efficiently the company is converting inventory into sales, with some periods of better operational performance and others indicating slower turnover.
- Average Inventory Processing Period
- The average inventory processing period exhibits an inverse pattern to the turnover ratio, which aligns with the typical relationship between these metrics. Starting at 151 days in Q1 2019, the period increased steadily to reach a peak of 191 days in Q4 2019. Thereafter, it decreased to a low of 142 days in Q1 2021, corresponding with the peak in inventory turnover ratio. From mid-2021 through early 2022, the processing period shows a moderate increase again, fluctuating mostly between 157 and 168 days. The period rises further towards the end of the dataset, peaking at 185 days in Q1 2023. This increase in processing period indicates longer inventory holding times, potentially suggesting slower sales or more cautious inventory management in recent quarters.
- Overall Insights
- Overall, there is a clear cyclical trend in inventory management efficiency. The early part of the period analyzed indicates a detriment in turnover efficiency, mirrored by longer inventory periods. This was followed by an improvement phase in early 2021 when the turnover ratio peaked, and the inventory processing period was minimized, reflecting more effective inventory control. Lately, the trends reveal a reversal with a gradual deterioration in turnover ratio and an increase in the average processing period, which might be influenced by external market conditions, demand changes, or internal supply chain adjustments. Continuous monitoring and targeted measures may be necessary to improve inventory turnover and reduce processing times going forward.
Average Receivable Collection Period
Boston Scientific Corp., average receivable collection period calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||||||||||||||||
| Receivables turnover | 6.28 | 6.44 | 6.72 | 6.43 | 6.52 | 6.69 | 6.87 | 6.68 | 6.21 | 6.47 | 6.33 | 6.97 | 6.84 | 5.87 | 5.79 | 5.89 | 6.13 | 6.11 | — | — | — | |||||||
| Short-term Activity Ratio (no. days) | ||||||||||||||||||||||||||||
| Average receivable collection period1 | 58 | 57 | 54 | 57 | 56 | 55 | 53 | 55 | 59 | 56 | 58 | 52 | 53 | 62 | 63 | 62 | 60 | 60 | — | — | — | |||||||
| Benchmarks (no. days) | ||||||||||||||||||||||||||||
| Average Receivable Collection Period, Competitors2 | ||||||||||||||||||||||||||||
| Abbott Laboratories | 53 | 52 | 52 | 58 | 59 | 55 | 55 | 55 | 60 | 68 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| CVS Health Corp. | 31 | 31 | 31 | 32 | 32 | 31 | 32 | 32 | 32 | 30 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Elevance Health Inc. | 22 | 19 | 19 | 19 | 22 | 18 | 19 | 19 | 21 | 19 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Intuitive Surgical Inc. | 53 | 55 | 51 | 51 | 56 | 50 | 46 | 49 | 52 | 54 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Medtronic PLC | 62 | 64 | 63 | 63 | 63 | 66 | 68 | 70 | 64 | 59 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| UnitedHealth Group Inc. | 25 | 20 | 20 | 22 | 23 | 18 | 19 | 20 | 22 | 18 | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q1 2023 Calculation
Average receivable collection period = 365 ÷ Receivables turnover
= 365 ÷ 6.28 = 58
2 Click competitor name to see calculations.
- Receivables Turnover Ratio
- Over the observed periods starting from March 31, 2018, the receivables turnover ratio demonstrates a general pattern of moderate fluctuations. Initially, there is an increasing trend visible in the first few quarters of 2019, peaking around June and September 2020 with values close to 6.97 and 6.84, respectively. Following this peak, the ratio experiences minor declines and subsequent recoveries, maintaining values predominantly between 6.2 and 6.9. The overall trend indicates a stable management of receivables with some variability but no significant deterioration or improvement in turnover beyond typical operational fluctuations.
- Average Receivable Collection Period (in number of days)
- The average collection period exhibits an inverse relationship to the receivables turnover ratio, as expected. Initially, in early 2019, this period ranged from 60 to 63 days, indicating the time taken to collect receivables was around two months. A marked improvement is observed in mid-2020, with collection days decreasing to the low 50s, suggesting enhanced receivables management and quicker cash conversion cycles during this time. Subsequently, the collection period stabilizes around the mid-50s to high 50s days range through late 2021 and into 2023, signaling consistent efficiency in the collection process despite some minor quarter-to-quarter variations.
- Overall Interpretation
- The interplay between the receivables turnover ratio and the average collection period indicates that the company has maintained relatively efficient receivables management across the reported periods. Neither metric shows any extreme volatility or concerning downward trends. Improvements during mid-2020 likely reflect operational adjustments or changes in credit policy that reduced the time clients take to settle accounts. The stabilization of both metrics in recent quarters points towards sustained disciplined credit and collections practices.
Operating Cycle
Boston Scientific Corp., operating cycle calculation (quarterly data)
No. days
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||||||||||||||||
| Average inventory processing period | 185 | 172 | 167 | 167 | 168 | 158 | 157 | 141 | 145 | 142 | 162 | 172 | 186 | 185 | 191 | 164 | 156 | 151 | — | — | — | |||||||
| Average receivable collection period | 58 | 57 | 54 | 57 | 56 | 55 | 53 | 55 | 59 | 56 | 58 | 52 | 53 | 62 | 63 | 62 | 60 | 60 | — | — | — | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Operating cycle1 | 243 | 229 | 221 | 224 | 224 | 213 | 210 | 196 | 204 | 198 | 220 | 224 | 239 | 247 | 254 | 226 | 216 | 211 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Operating Cycle, Competitors2 | ||||||||||||||||||||||||||||
| Abbott Laboratories | 185 | 170 | 160 | 171 | 168 | 157 | 160 | 166 | 182 | 190 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| CVS Health Corp. | 55 | 57 | 56 | 57 | 59 | 58 | 59 | 59 | 61 | 61 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Intuitive Surgical Inc. | 215 | 216 | 206 | 190 | 186 | 172 | 172 | 178 | 190 | 201 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Medtronic PLC | 236 | 230 | 224 | 216 | 211 | 216 | 231 | 236 | 238 | 223 | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q1 2023 Calculation
Operating cycle = Average inventory processing period + Average receivable collection period
= 185 + 58 = 243
2 Click competitor name to see calculations.
The analysis of the financial time series reveals notable trends in the company's working capital management over the observed periods.
- Average Inventory Processing Period
- This metric demonstrates an overall increasing trend from the first available data point, starting at 151 days and gradually rising to 191 days by the end of 2018. After peaking at this point, there is a gradual decline to 141 days by the first quarter of 2021, indicating improved inventory turnover. Subsequently, the period fluctuates between 157 days and 185 days from mid-2021 through early 2023, signifying some instability or variability in inventory management efficiency during this latter phase.
- Average Receivable Collection Period
- The receivable collection period remains relatively stable, fluctuating narrowly between 52 and 63 days throughout the analyzed timespan. The highest values occur near the end of 2018, with a subsequent decline around mid-2020 during which the collection period briefly reduced to 52 days, potentially reflecting enhanced credit control measures. Post-2020, the days show a mild increasing trend but remain within a moderate range, suggesting consistent management of receivables.
- Operating Cycle
- The operating cycle length experiences a marked rise reaching its apex at 254 days at the end of 2018. Following this, a downward trend is observed through 2020, with the cycle shortening to 196 days by the first quarter of 2021, implying more efficient operational processes. However, from mid-2021 onwards, the operating cycle again extends progressively, reaching 243 days by the first quarter of 2023. This increase suggests a lengthening of the time taken to convert inventory and receivables into cash, possibly due to inventory accumulation or extended collection periods.
Overall, the data indicate that there was a period of operational tightening and efficiency improvements around 2019–2021, visible through reduced inventory processing and operating cycles. Nevertheless, a reversal or slowdown in these gains appears evident in the most recent periods, warranting further investigation into inventory management practices and credit policies to ensure optimal working capital utilization.
Average Payables Payment Period
Boston Scientific Corp., average payables payment period calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||||||||||||||||
| Payables turnover | 4.65 | 4.59 | 4.88 | 5.24 | 5.42 | 4.67 | 5.55 | 5.38 | 5.78 | 6.75 | 7.34 | 7.90 | 5.27 | 5.75 | 5.85 | 5.51 | 5.76 | 8.06 | — | — | — | |||||||
| Short-term Activity Ratio (no. days) | ||||||||||||||||||||||||||||
| Average payables payment period1 | 78 | 80 | 75 | 70 | 67 | 78 | 66 | 68 | 63 | 54 | 50 | 46 | 69 | 64 | 62 | 66 | 63 | 45 | — | — | — | |||||||
| Benchmarks (no. days) | ||||||||||||||||||||||||||||
| Average Payables Payment Period, Competitors2 | ||||||||||||||||||||||||||||
| Abbott Laboratories | 82 | 88 | 78 | 86 | 91 | 87 | 80 | 82 | 92 | 96 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| CVS Health Corp. | 17 | 20 | 19 | 19 | 19 | 19 | 20 | 18 | 18 | 19 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Elevance Health Inc. | 48 | 49 | 49 | 50 | 50 | 48 | 50 | 50 | 50 | 47 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Intuitive Surgical Inc. | 28 | 26 | 30 | 29 | 25 | 25 | 26 | 27 | 25 | 20 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Medtronic PLC | 79 | 82 | 71 | 67 | 64 | 73 | 66 | 70 | 66 | 77 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| UnitedHealth Group Inc. | 53 | 50 | 52 | 53 | 54 | 48 | 52 | 52 | 56 | 50 | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q1 2023 Calculation
Average payables payment period = 365 ÷ Payables turnover
= 365 ÷ 4.65 = 78
2 Click competitor name to see calculations.
- Payables Turnover Ratio
- The payables turnover ratio reveals a declining trend beginning in early 2019. Initially, the ratio was 8.06 at the end of March 2019 but dropped substantially to 5.76 by June 2019. This lower level generally remained consistent with slight fluctuations, dipping as low as 4.59 in September 2022 before moderately increasing to 4.65 in March 2023. These values demonstrate a general weakening in the speed at which payables are being settled over the observed period.
- Average Payables Payment Period (Days)
- Complementary to the turnover ratio, the average payables payment period shows an increasing pattern, indicating that payables are being paid more slowly. Starting at 45 days in March 2019, there is a rise to 63 days by June 2019 and a peak of 78 days reached twice, in March 2022 and again in March 2023. This reinforces the interpretation that the company has extended its payment cycle gradually over these years.
- Summary of Trends and Insights
- The inverse relationship between the payables turnover ratio and the average payment period is evident, consistent with financial principles. The lengthening payment periods alongside decreased turnover imply a strategic or operational shift toward slower payment practices. This could be interpreted as a liquidity management measure to retain cash longer or possibly due to increased negotiation of payment terms with suppliers. However, the growing payment period might also suggest pressures on cash flow or evolving supplier relationships that deserve further investigation.
Cash Conversion Cycle
Boston Scientific Corp., cash conversion cycle calculation (quarterly data)
No. days
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||||||||||||||||||
| Average inventory processing period | 185 | 172 | 167 | 167 | 168 | 158 | 157 | 141 | 145 | 142 | 162 | 172 | 186 | 185 | 191 | 164 | 156 | 151 | — | — | — | |||||||
| Average receivable collection period | 58 | 57 | 54 | 57 | 56 | 55 | 53 | 55 | 59 | 56 | 58 | 52 | 53 | 62 | 63 | 62 | 60 | 60 | — | — | — | |||||||
| Average payables payment period | 78 | 80 | 75 | 70 | 67 | 78 | 66 | 68 | 63 | 54 | 50 | 46 | 69 | 64 | 62 | 66 | 63 | 45 | — | — | — | |||||||
| Short-term Activity Ratio | ||||||||||||||||||||||||||||
| Cash conversion cycle1 | 165 | 149 | 146 | 154 | 157 | 135 | 144 | 128 | 141 | 144 | 170 | 178 | 170 | 183 | 192 | 160 | 153 | 166 | — | — | — | |||||||
| Benchmarks | ||||||||||||||||||||||||||||
| Cash Conversion Cycle, Competitors2 | ||||||||||||||||||||||||||||
| Abbott Laboratories | 103 | 82 | 82 | 85 | 77 | 70 | 80 | 84 | 90 | 94 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| CVS Health Corp. | 38 | 37 | 37 | 38 | 40 | 39 | 39 | 41 | 43 | 42 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Intuitive Surgical Inc. | 187 | 190 | 176 | 161 | 161 | 147 | 146 | 151 | 165 | 181 | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Medtronic PLC | 157 | 148 | 153 | 149 | 147 | 143 | 165 | 166 | 172 | 146 | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q1 2023 Calculation
Cash conversion cycle = Average inventory processing period + Average receivable collection period – Average payables payment period
= 185 + 58 – 78 = 165
2 Click competitor name to see calculations.
- Average inventory processing period
- The average inventory processing period shows a generally increasing trend from 151 days in March 2019 to a peak of 191 days in December 2018, followed by fluctuations. It declined to 142 days by March 2021, then rose again, fluctuating around 167 to 185 days from March 2022 to March 2023. This indicates periods of inventory holding becoming longer and shorter over time, with a tendency towards lengthening in recent quarters.
- Average receivable collection period
- The average receivable collection period has remained relatively stable, fluctuating slightly within the range of 52 to 63 days. A minor decline is observed from 62-63 days in late 2018/early 2019 to lows around 52-53 days in mid-2020 and mid-2021, followed by modest increases to approximately 57-58 days by early 2023. Overall, the company appears to maintain consistent collection efficiency.
- Average payables payment period
- The average payables payment period exhibits notable variability. Starting at 45 days in early 2019, it increased sharply to 78 days by March 2023, with some oscillations including dips to 46 days in September 2020 and peaks near or above 75 days afterwards. This suggests an extension in payment timeframes, potentially reflecting strategic working capital management or changes in supplier terms.
- Cash conversion cycle
- The cash conversion cycle started around 160 days in early 2019, peaked at 192 days by December 2018, then gradually declined to a low of 128 days in September 2021. Post this low, it has increased again, reaching 165 days by March 2023. The fluctuations in the cycle are largely influenced by the changes in inventory processing and payable payment periods, indicating variations in the efficiency with which the company converts its investments in inventory and other resources into cash flows.