AAON Inc (AAON)
Cash conversion cycle
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 80.24 | 83.91 | 88.46 | 86.30 | 93.10 | 92.51 | 98.49 | 99.12 | 100.29 | 86.29 | 73.65 | 73.46 | 69.63 | 65.50 | 73.06 | 62.79 | 83.44 | 95.36 | 126.28 | 204.60 |
| Days of sales outstanding (DSO) | days | 43.28 | 52.41 | 54.70 | 60.28 | 52.03 | 64.17 | 71.71 | 69.86 | 51.89 | 42.89 | 40.36 | 44.19 | 36.71 | 46.16 | 44.83 | 51.63 | 52.99 | 47.64 | 57.43 | 51.57 |
| Number of days of payables | days | 10.33 | 11.70 | 13.23 | 12.78 | 21.30 | 25.42 | 21.73 | 24.29 | 22.34 | 21.41 | 17.91 | 15.40 | 10.54 | 13.33 | 16.85 | 11.64 | 13.33 | 13.15 | 12.92 | 16.32 |
| Cash conversion cycle | days | 113.19 | 124.62 | 129.93 | 133.79 | 123.83 | 131.26 | 148.47 | 144.70 | 129.83 | 107.77 | 96.10 | 102.25 | 95.79 | 98.33 | 101.04 | 102.79 | 123.10 | 129.85 | 170.78 | 239.85 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 80.24 + 43.28 – 10.33
= 113.19
The cash conversion cycle of AAON Inc. has shown some fluctuations over the past eight quarters. The cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
In Q1 2022, the cash conversion cycle was the highest at 159.60 days before decreasing slightly in Q2 2022 to 163.66 days. However, the cycle improved in Q3 2022 and Q4 2022, reaching 144.48 days and 138.21 days, respectively.
In the first quarter of 2023, there was a notable increase in the cash conversion cycle to 148.68 days. The cycle continued to rise in Q2 and Q3 2023, reaching 146.03 days and 142.10 days, respectively. However, there was a slight improvement in Q4 2023, with the cycle decreasing to 131.39 days.
Overall, AAON Inc. has experienced fluctuations in its cash conversion cycle over the past eight quarters. It is essential for the company to focus on managing its inventory, accounts receivable, and accounts payable efficiently to optimize its cash conversion cycle and improve working capital management.
Peer comparison
Dec 31, 2023