Name: Receivables Turnover

Definition: Receivables turnover tells you how quickly the company collects payments from customers after making sales on credit. A high turnover means customers pay on time and cash flows smoothly. Slow turnover suggests delayed collections, which can create cash shortages and financing stress.

Interpretation:
• In '2021', CVS's receivables turnover was 11.96, showing efficiency in collecting outstanding receivables. Industry average for Retail-Drug Stores and Proprietary Stores in '2021' stood at 7.19.
• In '2022', CVS's receivables turnover was 12.47, showing efficiency in collecting outstanding receivables. The increase since '2021' reflects strengthening financial performance. Industry average for Retail-Drug Stores and Proprietary Stores in '2022' stood at 8.02. Industry average increased by 0.83 compared to previous year.
• In '2023', CVS's receivables turnover was 11.45, showing efficiency in collecting outstanding receivables. The decline from '2022' may indicate some operational or financial challenges. Industry average for Retail-Drug Stores and Proprietary Stores in '2023' stood at 7.56. Industry average declined by 0.45 from previous year.
• In '2024', CVS's receivables turnover was 10.40, showing efficiency in collecting outstanding receivables. The decline from '2023' may indicate some operational or financial challenges. Industry average for Retail-Drug Stores and Proprietary Stores in '2024' stood at 8.60. Industry average increased by 1.04 compared to previous year.
Overall, CVS's receivables turnover has consistently declined during the past 4 years.

Formula: Receivables Turnover = Net Credit Sales / Average Accounts Receivable

Good Range: Ranges 5 to 15 depending on credit terms.