Avient Corp (AVNT)
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 | 57.97 | 56.54 | 54.11 | 45.25 | 48.64 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 57.97 | 56.54 | 54.11 | 45.25 | 48.64 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 57.97 + — – —
= 57.97
The cash conversion cycle for Avient Corp has shown fluctuations over the past five years. In December 2020, the cash conversion cycle was 48.64 days, indicating that, on average, it took the company approximately 48.64 days to convert its investments in inventory and receivables into cash.
Subsequently, the cash conversion cycle decreased to 45.25 days by December 2021, reflecting an improvement in the efficiency of Avient Corp's cash management. However, the trend reversed in the following years, with the cash conversion cycle increasing to 54.11 days in December 2022, 56.54 days in December 2023, and further to 57.97 days by December 2024.
The increasing trend in the cash conversion cycle suggests that Avient Corp may be experiencing challenges in managing its working capital efficiently. A longer cash conversion cycle can tie up valuable financial resources and indicate potential issues with inventory management, accounts receivable collection, or payment terms with suppliers.
Overall, Avient Corp should closely monitor its cash conversion cycle and identify opportunities to streamline its operations to improve cash flow and overall financial performance.
Peer comparison
Dec 31, 2024