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Chipotle Mexican Grill Inc  (NYSE:CMG) Accounts Receivable: \$50 Mil (As of Mar. 2019)

Accounts Receivable are created when a customer has received a product but has not yet paid for that product. Chipotle Mexican Grill Inc's accounts receivables for the quarter that ended in Mar. 2019 was \$50 Mil.

Accounts receivable can be measured by Days Sales Outstanding. Chipotle Mexican Grill Inc's Days Sales Outstanding for the quarter that ended in Mar. 2019 was 3.47.

In Ben Graham's calculation of liquidation value, accounts receivable are only considered to be worth 75% of book value. Chipotle Mexican Grill Inc's Net-Net Working Capital for the quarter that ended in Mar. 2019 was \$-2,360 Mil.

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Chipotle Mexican Grill Inc Annual Data

 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Accounts Receivable 34.84 38.28 40.45 40.45 62.31

Chipotle Mexican Grill Inc Quarterly Data

 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Accounts Receivable 26.69 23.70 26.87 62.31 49.73

Calculation

Accounts Receivable is money owed to a business by customers and shown on its Balance Sheet as an asset.

Explanation

1. Accounts Receivable are created when a customer has received a product but has not yet paid for that product. Days Sales Outstanding measures of the average number of days that a company takes to collect revenue after a sale has been made. It is a financial ratio that illustrates how well a company's accounts receivables are being managed.

Chipotle Mexican Grill Inc's Days Sales Outstanding for the quarter that ended in Mar. 2019 is calculated as:

 Days Sales Outstanding = Accounts Receivable / Revenue * Days in Period = 49.725 / 1308.217 * 91 = 3.47

2. In Ben Graham's calculation of liquidation value, Chipotle Mexican Grill Inc's accounts receivable are only considered to be worth 75% of book value:

Chipotle Mexican Grill Inc's liquidation value for the quarter that ended in Mar. 2019 is calculated as:

 Liquidation value = Cash And Cash Equivalents - Total Liabilities + (0.75 * Accounts Receivable) + (0.5 * Total Inventories) = 735.024 - 3141.683 + 0.75 * 49.725 + 0.5 * 18.78 = -2,360

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Be Aware

Net receivables tells us a great deal about the different competitors in the same industry. In competitive industries, some attempt to gain advantage by offering better credit terms, causing increase in sales and receivables.

If company consistently shows lower % Net receivables to gross sales than competitors, then it usually has some kind of competitive advantage which requires further digging.

Average Days Sales Outstanding is a good indicator for measuring a company's sales channel and customers. A company may book great revenue and earnings growth but never receive payment from their customers. This may force a write-off in the future and depress future earnings.

Related Terms