CarGurus (CARG)
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 | 0.77 | 0.68 | 0.87 | 0.62 | 0.46 | 0.33 | 0.34 | 0.72 | 1.93 | 10.21 | 10.00 | 14.77 | 24.40 | 16.00 | — | — | — | 152.99 | 186.62 | 264.14 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 0.77 | 0.68 | 0.87 | 0.62 | 0.46 | 0.33 | 0.34 | 0.72 | 1.93 | 10.21 | 10.00 | 14.77 | 24.40 | 16.00 | 0.00 | 0.00 | 0.00 | 152.99 | 186.62 | 264.14 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 0.77 + — – —
= 0.77
The cash conversion cycle of CarGurus, which measures the company's ability to convert its investments in inventory and accounts receivable into cash, has shown a decreasing trend over the years.
Starting at 264.14 days on March 31, 2020, the cash conversion cycle decreased significantly to 10.00 days by June 30, 2022. This improvement indicates that CarGurus has been able to manage its inventory and collect payments from customers more efficiently.
From September 2022 onwards, the cash conversion cycle has stabilized at around 10-20 days, showcasing the company's consistent ability to efficiently manage its working capital.
The decreasing trend in the cash conversion cycle indicates that CarGurus has been able to streamline its operations, optimize inventory levels, and shorten the time it takes to collect payments from customers. This could potentially free up cash for investment in growth opportunities or reduce the need for external financing. Overall, the downward trend in the cash conversion cycle is a positive indicator of CarGurus' effective management of working capital.
Peer comparison
Dec 31, 2024