Ciena Corp (CIEN)
Cash conversion cycle
| Jan 27, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 30, 2021 | Oct 31, 2020 | Aug 1, 2020 | May 2, 2020 | Jan 31, 2019 | Jul 31, 2018 | Apr 30, 2018 | Jan 31, 2018 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 145.08 | 152.95 | 181.22 | 173.50 | 194.34 | 166.75 | 143.73 | 93.96 | 85.23 | 71.95 | 76.84 | 83.36 | 78.33 | 67.14 | 69.29 | 64.62 | 68.03 | 49.01 | 51.79 | 54.12 |
| Days of sales outstanding (DSO) | days | 74.05 | 86.31 | 87.63 | 97.68 | 102.45 | 94.93 | 80.56 | 75.37 | 79.46 | 91.07 | 95.98 | — | 76.68 | 77.81 | — | — | 95.91 | 90.52 | 82.93 | 71.81 |
| Number of days of payables | days | 46.56 | 46.26 | 59.74 | 70.27 | 78.93 | 90.89 | 76.37 | 61.78 | 57.76 | 68.47 | 62.60 | 58.01 | 49.69 | 56.91 | 56.63 | 57.96 | 70.65 | 67.23 | 59.19 | 44.37 |
| Cash conversion cycle | days | 172.57 | 193.00 | 209.11 | 200.90 | 217.86 | 170.79 | 147.93 | 107.55 | 106.93 | 94.55 | 110.21 | 25.34 | 105.32 | 88.04 | 12.66 | 6.66 | 93.29 | 72.29 | 75.53 | 81.57 |
January 27, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 145.08 + 74.05 – 46.56
= 172.57
The cash conversion cycle of CIENA Corp. fluctuated in the past eight quarters, ranging from 121.33 days to 231.98 days. The longest cash conversion cycle was observed in Q1 2023 at 231.98 days, indicating a longer time taken by the company to convert its investment in inventory into cash. Conversely, the shortest cash conversion cycle was recorded in Q2 2022 at 121.33 days, signifying a quicker conversion process.
Overall, there is a trend of increasing cash conversion cycles in the last four quarters, with Q3 2023 having the second-highest at 221.39 days, following the peak in Q1 2023. This trend suggests potential challenges in managing working capital efficiently and converting sales into cash. It would be essential for CIENA Corp. to focus on optimizing its inventory management, accounts receivable collection, and accounts payable payment processes to shorten the cash conversion cycle and improve liquidity.
Peer comparison
Jan 27, 2024