Elevance Health Inc. (NYSE:ELV)

The analysis of the financial ratios over the periods indicates several notable trends in the company's operational efficiency and working capital management.

Receivables Turnover

This ratio reflects the company's effectiveness in collecting receivables. Beginning around 19.72, it fluctuated moderately, showing a peak near 20.66 during early 2022, followed by some variability and a downward trend toward the end of the observed period, reaching values as low as 14.42. This suggests a general decline in the speed of receivables collection, implying potential challenges in cash inflows from customers toward recent quarters.

Payables Turnover

The payables turnover ratio remained relatively stable with a slight upward trend. Starting from approximately 7.75, it oscillated within a narrow range and increased moderately, reaching values above 8 in the last periods. This indicates consistent payment practices with a gradual improvement in the rate at which payables are settled.

Working Capital Turnover

This ratio demonstrated notable variability. It increased from about 6.39 to values exceeding 9 during 2021 and early 2022, suggesting improved efficiency in utilizing working capital to generate sales. However, this was followed by a decline to around 6.87 to 7 toward the later periods. The fluctuations suggest changing dynamics in managing current assets and liabilities in relation to revenues.

Average Receivable Collection Period (number of days)

The average collection period remained fairly stable, generally hovering between 18 and 23 days across the periods. Slight increases in certain quarters correlate with lower receivables turnover, indicating some slowdown in cash collections during those times, but overall the company maintained a consistent collection policy.

Average Payables Payment Period (number of days)

The average days to pay payables also showed stability, mainly ranging from 44 to 50 days. Minor reductions in this period were observed towards the end of the timeframe analyzed. This consistency suggests disciplined vendor payment behavior, with a tendency toward slightly faster payments in recent quarters.

In summary, the company displays stable payment practices and working capital utilization with some recent indications of slower receivables collection and a slight reduction in working capital turnover. These trends may warrant further monitoring to ensure continued operational efficiency and liquidity management.

The quarterly financial data reveals several important trends and patterns related to premiums, premium receivables, and receivables turnover over the examined period.

Premiums

Premium revenues have shown a general upward trend from March 2020 through September 2025. Starting at approximately $25.5 billion in early 2020, premiums increased steadily to reach above $41.7 billion by the third quarter of 2025. There are intermittent fluctuations, including slight declines in certain quarters such as a drop from June 2023 to September 2023, and from December 2024 to March 2025; however, the overall trajectory is growth. This consistent increase indicates expanding business volume or pricing changes contributing to higher premium income over time.

Premium Receivables, Net

Premium receivables, net, show more variability than premiums. Beginning around $5.8 billion in March 2020, receivables exhibit periodic increases and decreases, with notable peaks observed. For instance, a significant rise took place in the first quarter of 2022 reaching over $7.3 billion. This was followed by fluctuations hovering mostly between $7 billion and $10.3 billion in subsequent quarters. The highest receivables balance is seen in June 2025 at about $10.5 billion. Such movement suggests varying collection effectiveness or timing delays in premium payments. The variability may also reflect seasonal billing patterns or changes in credit policies.

Receivables Turnover Ratio

The receivables turnover ratio data is available from December 2020 onwards, displaying ratios generally ranging between approximately 14 and 20. This ratio measures how efficiently premium receivables are collected. Over the quarters, the turnover ratio fluctuates without a clear directional trend but shows occasional dips below 16 and peaks near 20. A lower ratio observed towards the later quarters, for example, in September 2025 (around 14.4), suggests slower collection relative to earlier periods. Such variations could indicate changes in customer payment behavior or adjustments in credit terms.

In summary, the premiums trend upward steadily, signaling growth in business scale or revenue per unit. Meanwhile, premium receivables fluctuate notably, indicating variable collection cycles or credit exposure. The receivables turnover ratio confirms changes in collection efficiency, with periodic declines implying more extended collection periods at times. Together, the data suggests a growing premium base accompanied by some increased variability in receivables management and cash flow timing.

The financial data reveals several key trends in the company's operations and financial management over the observed periods.

Benefit Expense

The benefit expense exhibits a generally increasing trend from the beginning of the period through to the latest quarters. Starting at approximately 21.5 billion US dollars in March 2020, the expense rose steadily with some fluctuations, reaching over 38 billion US dollars by September 2025. Notably, there is consistent growth each year, with significant increments observed in mid to late 2024 and continuing into 2025, which may reflect increased healthcare costs, expanded coverage, or inflationary pressures affecting the benefit payouts.

Medical Claims Payable

The medical claims payable also shows an increasing trend overall, growing from approximately 9.9 billion US dollars in March 2020 to over 17.1 billion US dollars by September 2025. The growth is relatively gradual but consistent throughout the quarters, indicating a rise in the obligations related to medical claims. There are some periods of plateau or slight decline, such as in mid-2024, but the long-term trend is upward, suggesting either higher claim volumes or higher costs per claim.

Payables Turnover Ratio

The payables turnover ratio, which measures how quickly the company pays off its suppliers, shows relative stability with minor fluctuations. From a ratio near 7.75 in early 2020, it dipped slightly in 2021 to around 7.3 but then increased incrementally thereafter. By September 2025, the ratio reached approximately 8.38. This upward movement in later periods indicates an improvement in payment efficiency, meaning that the company is likely settling its payables more rapidly over time. Higher turnover ratios typically reflect stronger liquidity or better payables management.

Overall, the data reflects a company experiencing growth in both benefit expenses and associated liabilities, consistent with expanding operations or rising underlying costs in the healthcare sector. Meanwhile, the improving payables turnover ratio suggests enhanced financial discipline in managing payment cycles, which could be beneficial for cash flow management and supplier relationships.

The working capital of the entity demonstrates a fluctuating trend over the periods analyzed. Initially, it increased from 14,217 million US dollars at the end of March 2020 to a peak of 19,746 million US dollars by the end of March 2021. This was followed by a general decline with occasional recoveries until December 2021, after which working capital again shows a cyclical pattern of rises and falls. Notably, there are significant increases towards the later periods, particularly from June 2024 onwards, where the working capital reaches a high of 22,900 million US dollars by the end of September 2025.

The premiums earned display an overall upward trajectory throughout the timeline. Starting at 25,517 million US dollars in March 2020, premiums steadily increase to peak at 41,791 million US dollars by September 2025. Despite some minor fluctuations, the general movement is consistently positive, reflecting growing revenue from premiums over the observed quarters.

Working capital turnover ratios are available from December 2020 onward and indicate variations in efficiency relative to working capital. The turnover ratio shows an initial increase from 6.39 at the end of 2020 to a high of 9.11 by the end of September 2022, denoting improved utilization of working capital to generate revenue. Subsequently, the ratio fluctuates between approximately 6.87 and 8.59, indicating periods of both improved and reduced efficiency. The latter quarters show a moderate declining trend towards a ratio of 7 by September 2025, suggesting slightly diminished turnover relative to prior peaks.

Working Capital

Exhibits cyclical fluctuations with notable peaks and troughs, showing recovery and growth particularly after mid-2024, suggesting effective capital management or seasonal impacts.

Premiums

Show a clear upward trend throughout the entire time frame, indicating steady revenue growth from the company's core underwriting business.

Working Capital Turnover

Demonstrates variability in capital efficiency, with initial improvement followed by fluctuations and a mild decreasing trend in late periods, implying changing operational dynamics or investment strategies.

Receivables Turnover

The receivables turnover ratio demonstrates fluctuations over the observed periods, generally ranging between approximately 14 and 21. Highest turnover values are observed around March 2022 and September 2024, indicating more efficient collection of receivables during those quarters. Conversely, lower turnovers occur around June 2025, suggesting a decrease in collection efficiency. Overall, the ratio reflects a somewhat cyclical pattern without a clear linear trend, but notable variation indicating changing efficiency in managing receivables.

Average Receivable Collection Period

The average receivable collection period varies between about 18 and 25 days throughout the timeframe. Periods with lower collection days align inversely with higher receivables turnover, confirming consistency between the two metrics. The collection period tends to increase during mid-2024 and mid-2025, reaching up to 25 days, which corresponds with lower turnover rates in these quarters. This suggests the company experienced periods where it took longer to collect payments from customers, signaling a potential softness in credit management or customer payment behavior during those times.

Overall Analysis

The interplay between receivables turnover and collection period indicates that the company's effectiveness in managing and collecting receivables varies over the quarters. While some periods show strong collections with turnover ratios above 19 and collection periods under 20 days, there are recurring episodes where performance softens. These shifts could be attributed to seasonal factors, changes in credit policies, or external economic factors impacting customer payment patterns.

Payables Turnover Ratio

The payables turnover ratio exhibits a generally stable and slightly upward trend from the earliest recorded data point at 7.75 to a higher value of 8.38 towards the end of the observed period. This indicates a modest increase in the frequency with which the company settles its payables over time.

Throughout the quarters, the ratio fluctuates within a relatively narrow range, moving mostly between 7.3 and 8.4. The lowest values appear around mid to late 2020 when the ratio hovers near 7.3, while the higher values emerge in the later periods, particularly from mid-2023 onward, where the turnover ratio remains consistently above 7.5 and peaks near 8.4.

The increasing turnover ratio suggests an improving efficiency in managing payables, potentially reflecting better supplier payment management or favorable credit terms.

Average Payables Payment Period

The average payables payment period inversely correlates with the payables turnover ratio, showing a reduction from around 50 days in early 2020 towards 44 days by the end of the period.

The payment period remains fairly consistent during the majority of quarters studied, fluctuating mainly between 45 and 50 days. There is a notable decline beginning around early 2023, where the period decreases steadily from around 48 days to 44 days at the latest point.

This reduction suggests that the company is paying its suppliers more quickly over time, which aligns with the observed increase in the payables turnover ratio. Faster payment periods may indicate improved liquidity management or strategic efforts to capture early payment discounts.

Overall Insights

The combination of a rising payables turnover ratio and a decreasing average payables payment period points to enhanced efficiency in payable management. The company appears to be accelerating payments to suppliers, reflecting potential improvements in cash flow management, negotiation of payment terms, or operational prioritization of settling liabilities promptly.

While these trends are positive in terms of financial management, sustaining quicker payments may affect working capital. Therefore, it would be prudent to monitor other liquidity metrics to ensure overall financial stability is maintained alongside these improvements.