Ametek Inc (AME)
Cash conversion cycle
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 83.53 | 88.69 | 91.56 | 94.93 | 98.13 | 95.42 | 97.58 | 99.96 | 95.17 | 95.35 | 91.19 | 83.37 | 77.26 | 78.80 | 81.05 | 74.49 | 68.11 | 69.19 | 71.44 | 71.41 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 83.53 | 88.69 | 91.56 | 94.93 | 98.13 | 95.42 | 97.58 | 99.96 | 95.17 | 95.35 | 91.19 | 83.37 | 77.26 | 78.80 | 81.05 | 74.49 | 68.11 | 69.19 | 71.44 | 71.41 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 83.53 + — – —
= 83.53
Ametek Inc's cash conversion cycle, which measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales, has shown some fluctuations over the period from March 31, 2020, to December 31, 2024.
From March 2020 to December 2020, the company managed to reduce its cash conversion cycle from 71.41 days to 68.11 days, indicating an improvement in efficiency in managing its working capital and cash flows. However, in the subsequent quarters, the cash conversion cycle increased, reaching 95.35 days by September 2022. This upward trend continued until the end of December 2024, when it decreased to 83.53 days.
The increase in the cash conversion cycle from mid-2021 to the end of 2023 could suggest potential issues such as slower sales, longer inventory turnover, or delays in collecting receivables. These factors may have resulted in a longer cash conversion cycle, tying up more of the company's cash in operations.
As of December 2024, the cash conversion cycle had improved compared to the previous periods, indicating progress in managing working capital. However, it is essential for Ametek Inc to continually monitor and optimize its cash conversion cycle to ensure efficient utilization of resources and maintain healthy cash flows.
Peer comparison
Dec 31, 2024