ArcBest Corp (ARCB)
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 | — | 4.87 | 8.30 | 9.41 | 10.04 |
| Days of sales outstanding (DSO) | days | 37.59 | 39.80 | 40.52 | 54.39 | 41.58 |
| Number of days of payables | days | 34.93 | 42.82 | 55.68 | 73.04 | 45.44 |
| Cash conversion cycle | days | 2.66 | 1.85 | -6.86 | -9.24 | 6.18 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 37.59 – 34.93
= 2.66
The cash conversion cycle of ArcBest Corp has shown varying trends over the years based on the provided data.
- As of December 31, 2020, the company had a positive cash conversion cycle of 6.18 days, indicating that it took around 6 days to convert its investments in inventory and other resources into cash from sales.
- By December 31, 2021, the company managed to significantly improve its cash conversion cycle to -9.24 days, implying that ArcBest Corp was able to convert resources into cash before payment obligations were due.
- The trend continued in the following years, with the cash conversion cycle remaining negative at -6.86 days as of December 31, 2022, and improving further to -1.85 days by December 31, 2023, and 2.66 days by December 31, 2024.
The negative values in 2021 and 2022 indicate that the company was operating very efficiently in terms of converting its investments into cash, possibly through effective inventory management and collection processes. However, the positive values in 2023 and 2024 suggest a slight increase in the time taken to convert resources into cash.
Overall, ArcBest Corp has shown fluctuations in its cash conversion cycle over the years, with a mix of positive and negative values, signifying different levels of efficiency in managing its working capital and cash flow.
Peer comparison
Dec 31, 2024