Working capital ratio

(redirected from Working Capital to Sales Ratio)

Working capital ratio

Working capital expressed as a percentage of sales.

Working Capital Ratio

Cash and short-term assets expected to be converted to cash within a year as a percentage of the amount of annual sales. Because expansion requires capital on hand, the working capital ratio is considered a prime indicator of a company's ability to expand its operations without taking on additional debt. Perhaps more straightforwardly, it is often known as the working capital to sales ratio.
References in periodicals archive ?
This improved the working capital to sales ratio from 26.
In a context of steady growth, the working capital to sales ratio decreased significantly, to 27%, compared with 41% a year earlier.
The company had an adequate operating performance, which was reflected by its trailing 12 months operating working capital to sales ratio of 26.
Due to a more rational competitive environment, Arrow has been able to maintain lower inventory levels, resulting in a working capital to sales ratio of approximately $0.
The Company had a suitable operating performance, which was reflected by an operating working capital to sales ratio for the last trailing twelve month period ended on June 30 of 2007, of 31.
s (Avnet), Arrow's main competitor, working capital to sales ratio for the fiscal year ended July 2, 2005, was approximately $0.