Advance Auto Parts Inc (AAP)
Cash conversion cycle
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 231.88 | 262.13 | 288.59 | 280.19 | 294.49 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 231.88 | 262.13 | 288.59 | 280.19 | 294.49 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 231.88 + — – —
= 231.88
The cash conversion cycle of Advance Auto Parts Inc has shown a decreasing trend over the years, indicating an improvement in the company's efficiency in managing its working capital.
As of December 31, 2020, the cash conversion cycle was 294.49 days, which decreased to 280.19 days by December 31, 2021. It further decreased to 288.59 days by December 31, 2022. However, there was a significant drop in the cash conversion cycle by December 31, 2023, where it reduced to 262.13 days, showing a notable improvement in the company's cash conversion efficiency.
By the end of December 31, 2024, the cash conversion cycle decreased even further to 231.88 days, indicating that Advance Auto Parts Inc has been able to optimize its working capital management, which may lead to increased liquidity and potentially improved financial performance.
Peer comparison
Dec 31, 2024