Topbuild Corp (BLD)
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 | 32.18 | 29.82 | 36.92 | 41.48 | 24.28 |
| Days of sales outstanding (DSO) | days | 51.46 | 56.95 | 61.64 | 70.87 | 58.07 |
| Number of days of payables | days | 36.12 | 38.39 | 41.00 | 54.31 | 49.90 |
| Cash conversion cycle | days | 47.52 | 48.38 | 57.56 | 58.04 | 32.44 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 32.18 + 51.46 – 36.12
= 47.52
The cash conversion cycle of Topbuild Corp has shown fluctuations over the past five years. In 2020, the company had a relatively short cash conversion cycle of 32.44 days, indicating efficient management of its cash, inventory, and receivables. However, by the end of 2021, the cash conversion cycle increased significantly to 58.04 days, suggesting a potential slowdown in the company's cash flow efficiency.
Subsequently, in 2022 and 2023, the cash conversion cycle remained relatively stable, ranging from 57.56 days to 48.38 days. This stability may indicate that Topbuild Corp implemented measures to optimize its working capital management during this period.
By the end of 2024, the cash conversion cycle decreased slightly to 47.52 days, indicating a moderate improvement in the company's cash flow efficiency compared to the previous year. Overall, Topbuild Corp's cash conversion cycle trend reflects a mix of efficient and less efficient cash management practices over the analyzed period, which may require further evaluation to pinpoint the underlying factors driving these fluctuations.