Coherent Inc (COHR)
Cash conversion cycle
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 100.28 | 85.70 | 117.15 | 96.07 | 101.57 |
| Days of sales outstanding (DSO) | days | 70.20 | 67.60 | 80.03 | 79.78 | 96.00 |
| Number of days of payables | days | 49.23 | 27.30 | 56.45 | 40.66 | 44.04 |
| Cash conversion cycle | days | 121.25 | 126.01 | 140.73 | 135.19 | 153.53 |
June 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 100.28 + 70.20 – 49.23
= 121.25
The cash conversion cycle for Coherent Inc has shown some fluctuation over the past five years. In the most recent fiscal year, ending on June 30, 2024, the company's cash conversion cycle decreased to 121.25 days compared to the previous year's 126.01 days. This indicates an improvement in the company's ability to efficiently manage its cash flows from the time inventory is purchased to the time cash is received from customers.
Looking further back, we see a general trend of decreasing cash conversion cycles from 2020 to 2024, suggesting that Coherent Inc has been more effective in managing its working capital and optimizing its operational efficiency over time. The decline in the cash conversion cycle signifies that the company is reducing the time it takes to convert its investments in raw materials into cash receipts from sales, which is a positive indicator of liquidity and financial health.
Overall, the decreasing trend in the cash conversion cycle for Coherent Inc reflects improvements in inventory management, accounts receivable collection, and accounts payable payment processes. This implies that the company is operating more efficiently and effectively in converting its resources into cash, which is crucial for sustaining and growing its operations.
Peer comparison
Jun 30, 2024