CNH Industrial N.V. (CNH)
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 | 130.58 | 120.20 | 105.92 | 109.15 | 102.33 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 130.58 | 120.20 | 105.92 | 109.15 | 102.33 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 130.58 + — – —
= 130.58
The cash conversion cycle for CNH Industrial N.V. has shown fluctuations over the years:
- In 2020, the cash conversion cycle was 102.33 days, indicating the company takes approximately 102 days to convert its investments in inventory and other resources into cash inflows from sales.
- By the end of 2021, the cash conversion cycle increased to 109.15 days, suggesting a longer period to convert resources into cash, which may indicate difficulties in managing working capital efficiently.
- However, in 2022, there was a slight improvement as the cash conversion cycle decreased to 105.92 days, signaling a more efficient working capital management compared to the previous year.
- The cycle then rose significantly to 120.20 days by the end of 2023, indicating that CNH Industrial N.V. faced challenges in converting its investments into cash during that period.
- Finally, by the end of 2024, the cycle extended even further to 130.58 days, highlighting a potential worsening in the company's ability to efficiently convert resources into cash.
Overall, the trend in the cash conversion cycle for CNH Industrial N.V. shows some variability, with periods of improvement followed by increased inefficiencies in working capital management. It is essential for the company to closely monitor and enhance its cash conversion cycle to ensure optimal resource utilization and cash flow generation.
Peer comparison
Dec 31, 2024