Cummins Inc (CMI)
Number of days of payables
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Payables turnover | 6.06 | 5.92 | 5.70 | 4.95 | 5.02 | 4.98 | 5.52 | 5.31 | 6.07 | 5.69 | 5.51 | 4.82 | 5.29 | 5.67 | 6.67 | 6.36 | 6.94 | 6.33 | 6.03 | 6.01 | |
| Number of days of payables | days | 60.23 | 61.67 | 64.03 | 73.81 | 72.68 | 73.23 | 66.11 | 68.72 | 60.17 | 64.16 | 66.25 | 75.72 | 69.00 | 64.43 | 54.71 | 57.41 | 52.58 | 57.69 | 60.57 | 60.74 |
December 31, 2023 calculation
Number of days of payables = 365 ÷ Payables turnover
= 365 ÷ 6.06
= 60.23
The number of days of payables for Cummins Inc. has shown fluctuations over the past eight quarters. In Q4 2023, it stood at 60.23 days, showing a slight decrease from the preceding quarter. This indicates that the company takes approximately 60 days on average to pay its suppliers and vendors. Comparing this to Q1 2023, where the number of days of payables was 73.81 days, there has been a notable improvement in managing payables efficiently.
Looking at the trend over the past two years, the number of days of payables has ranged from a low of 60.23 days to a high of 73.81 days. Generally, a lower number of days of payables suggests that the company is paying its suppliers more quickly, which can sometimes indicate strong liquidity and effective working capital management. However, a significant decrease in the number of days of payables could also signal potential cash flow issues or strained supplier relationships.
It is essential for Cummins Inc. to monitor its days of payables closely to ensure a balance between maximizing cash flow and maintaining positive relationships with suppliers. By analyzing this metric in conjunction with other financial ratios and operational performance indicators, the company can gain valuable insights into its financial health and efficiency in managing its working capital.
Peer comparison
Dec 31, 2023
See also:
Cummins Inc Average Payables Payment Period (Quarterly Data)