AeroVironment Inc (AVAV)
Cash conversion cycle
| Apr 30, 2025 | Apr 30, 2024 | Apr 30, 2023 | Apr 30, 2022 | Apr 30, 2021 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 104.77 | 126.65 | 138.05 | 108.64 | 113.52 |
| Days of sales outstanding (DSO) | days | 206.53 | 137.39 | 130.52 | 134.96 | 124.11 |
| Number of days of payables | days | 52.69 | 40.73 | 31.18 | 23.07 | 39.36 |
| Cash conversion cycle | days | 258.62 | 223.30 | 237.38 | 220.53 | 198.27 |
April 30, 2025 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 104.77 + 206.53 – 52.69
= 258.62
The cash conversion cycle (CCC) of AeroVironment Inc. over the period from April 30, 2021, to April 30, 2025, demonstrates notable fluctuation and an overall upward trend. Specifically, the CCC was 198.27 days as of April 30, 2021. It increased to 220.53 days by April 30, 2022, reflecting a rise of approximately 22.26 days within a year. This upward movement continued, with the cycle reaching 237.38 days by April 30, 2023, an increase of roughly 16.85 days from the previous year.
In the subsequent years, the cycle exhibited a slight reduction followed by a significant increase. By April 30, 2024, the CCC decreased marginally to 223.30 days, indicating a temporary improvement or slowdown in the cycle's length. However, by April 30, 2025, the cycle expanded again to 258.62 days, marking a substantial increase of over 35 days compared to the previous year and reaching the highest value within this period.
This overall trend illustrates that AeroVironment Inc. has experienced a lengthening of its cash conversion cycle over the analyzed years. The increasing CCC suggests that the company's average time to convert investments in inventory and receivables into cash has lengthened. Potential underlying factors may include longer receivables collection periods, extended inventory turnover times, or both. The fluctuations, including the brief decline in 2024, indicate periods of slight efficiency improvements amidst an overarching trend toward extended cash cycles.
In conclusion, the data reflects a gradual deterioration in working capital management efficiency, as evidenced by the increasing cash conversion cycle over the analyzed period. This trend warrants further investigation into operational and financial practices affecting receivables, inventory management, and payable policies to better understand the underlying causes.
Peer comparison
Apr 30, 2025