Analog Devices Inc (ADI)
Cash conversion cycle
| Oct 28, 2023 | Oct 29, 2022 | Oct 30, 2021 | Oct 31, 2020 | Nov 2, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 76.23 | 63.58 | 94.52 | 69.34 | 67.63 |
| Days of sales outstanding (DSO) | days | 44.50 | 55.63 | 76.83 | 49.76 | 40.23 |
| Number of days of payables | days | 22.89 | 26.44 | 34.91 | 25.91 | 24.98 |
| Cash conversion cycle | days | 97.85 | 92.77 | 136.43 | 93.19 | 82.88 |
October 28, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 76.23 + 44.50 – 22.89
= 97.85
The cash conversion cycle of Analog Devices Inc. has fluctuated over the past five years. In the most recent fiscal year ending on October 28, 2023, the cash conversion cycle stood at 138.31 days, representing a decrease from the prior year. This indicates that the company took longer to convert its investments in inventory and receivables into cash during this period.
In the fiscal year ending on October 30, 2021, the cash conversion cycle was notably longer at 171.71 days, suggesting a delay in the conversion of raw materials and work-in-progress to finished goods, as well as a prolonged collection period for receivables.
Conversely, in the fiscal year ending on October 31, 2020, the company managed to shorten its cash conversion cycle significantly to 120.75 days, indicating an improvement in managing its operating cycle and cash flow efficiency.
It is worth noting that in the previous year ending on November 2, 2019, the cash conversion cycle was at 109.69 days, reflecting a relatively efficient conversion of inventory and receivables into cash.
Overall, the fluctuation in Analog Devices Inc.'s cash conversion cycle over the period indicates varying efficiency in managing its working capital components, including inventory, accounts receivable, and accounts payable.
Peer comparison
Oct 28, 2023