Select Medical(Sem) Financials: Payables Turnover Compared To Industry Average, Plus Other Key Ratios
Growth Trend (Last 5 Years)
Growth - payables turnover
This chart shows the historical trend of payables turnover for SEM compared to its industry average over the recent years.
Ratio Definition and Interpretation
Name: Payables Turnover
Definition: Payables turnover shows how fast the company pays its suppliers for goods or services bought on credit. A high turnover means the company pays suppliers quickly, which may reflect strong cash flow or favorable terms. A very low turnover might mean the company is stretching payments to preserve cash — or possibly experiencing financial strain.
Interpretation:
• In '2021', SEM's payables turnover was 22.46, indicating how promptly the company pays its suppliers. Industry average for Hospital/Nursing Management in '2021' stood at 3.97.
• In '2022', SEM's payables turnover was 19.92, indicating how promptly the company pays its suppliers. The decline from '2021' may indicate some operational or financial challenges. Industry average for Hospital/Nursing Management in '2022' stood at 3.67. Industry average declined by 0.30 from previous year.
• In '2023', SEM's payables turnover was 24.86, indicating how promptly the company pays its suppliers. The increase since '2022' reflects strengthening financial performance. Industry average for Hospital/Nursing Management in '2023' stood at 3.82. Industry average increased by 0.15 compared to previous year.
• In '2024', SEM's payables turnover was 29.98, indicating how promptly the company pays its suppliers. The increase since '2023' reflects strengthening financial performance. Industry average for Hospital/Nursing Management in '2024' stood at 2.17. Industry average declined by 1.65 from previous year.
Overall, SEM's payables turnover has been volatile but showed an upward trend over the past 4 years.
Formula: Payables Turnover = Cost of Goods Sold / Average Accounts Payable
Good Range: Ranges 5-15 depending on industry.