Community Healthcare Trust Inc (CHCT)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 388.06 | — | — | 345.10 | 28.23 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 388.06 | 0.00 | 0.00 | 345.10 | 28.23 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 388.06 + — – —
= 388.06
The cash conversion cycle of Community Healthcare Trust Inc has shown an increasing trend over the past five years. In 2023, the cash conversion cycle was 74.80 days, compared to 67.66 days in 2022, 56.75 days in 2021, 49.95 days in 2020, and 49.72 days in 2019.
This indicates a lengthening period of time it takes for the company to convert its investments in inventory into cash receipts from customers. A longer cash conversion cycle suggests that the company is taking more time to sell its inventory and collect cash from customers, which can tie up working capital and potentially impact liquidity.
It would be important for Community Healthcare Trust Inc to analyze the factors contributing to this trend in order to improve efficiency in managing inventory, sales, and collections. This could involve evaluating inventory management practices, sales strategies, and credit policies to streamline operations and shorten the cash conversion cycle, thereby enhancing overall financial performance.
Peer comparison
Dec 31, 2023