Chemed Corp (CHE)
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 | 1.90 | 2.98 | 2.74 | 2.69 | 1.88 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 1.90 | 2.98 | 2.74 | 2.69 | 1.88 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 1.90 + — – —
= 1.90
The cash conversion cycle of Chemed Corp has experienced some fluctuations over the years. As of December 31, 2020, the company had a cash conversion cycle of 1.88 days, indicating a relatively efficient management of working capital. However, by December 31, 2023, the cash conversion cycle had increased to 2.98 days, suggesting a lengthening of the time it takes for the company to convert its investments in inventory and accounts receivable into cash.
This trend continued into December 31, 2024, where the cash conversion cycle decreased slightly to 1.90 days, potentially indicating a more effective management of working capital compared to the previous year. Overall, it is important for Chemed Corp to monitor and potentially improve its cash conversion cycle to ensure optimal cash flow management and efficiency in its operations.
Peer comparison
Dec 31, 2024