Cencora Inc. (COR)
Cash conversion cycle
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 24.41 | 24.37 | 24.10 | 25.96 | 25.16 | 25.03 | 25.88 | 26.24 | 24.66 | 25.34 | 25.58 | 27.85 | 27.09 | 27.63 | 24.79 | 25.43 | 24.88 | 23.86 | 22.37 | 24.10 |
| Days of sales outstanding (DSO) | days | 29.75 | 30.99 | 30.03 | 29.03 | 29.22 | 29.89 | 28.79 | 28.25 | 28.49 | 28.96 | 29.00 | 28.61 | 31.37 | 32.06 | 26.90 | 28.53 | 27.55 | 25.75 | 29.23 | 25.20 |
| Number of days of payables | days | 65.46 | 66.41 | 63.32 | 66.44 | 66.07 | 64.99 | 65.24 | 65.30 | 63.70 | 62.94 | 62.99 | 66.01 | 67.01 | 67.26 | 60.13 | 64.55 | 62.65 | 58.69 | 61.91 | 60.18 |
| Cash conversion cycle | days | -11.30 | -11.06 | -9.19 | -11.45 | -11.69 | -10.07 | -10.56 | -10.81 | -10.55 | -8.64 | -8.42 | -9.55 | -8.55 | -7.56 | -8.44 | -10.59 | -10.22 | -9.07 | -10.30 | -10.88 |
September 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 24.41 + 29.75 – 65.46
= -11.30
The cash conversion cycle of Cencora Inc. over the past 20 quarters has shown some fluctuation but generally reflects efficient management of working capital. The company has consistently maintained a negative cash conversion cycle, indicating effective management in converting inventory to cash.
The trend indicates that Cencora Inc. has been able to reduce the time it takes to sell its inventory, collect receivables, and pay its payables efficiently. A negative cash conversion cycle implies that the company is able to collect cash from customers before paying its suppliers, resulting in a shorter operating cycle.
There was a slight increase in the cash conversion cycle in the last two quarters, indicating a potential delay in turning inventory into sales or a slowdown in the collection of receivables. However, the overall trend still points towards effective working capital management.
Cencora Inc.'s ability to operate with a negative cash conversion cycle suggests that the company is managing its liquidity well and efficiently utilizing its resources to generate cash flow. It also indicates that the company has a good balance between managing inventory, accounts receivable, and accounts payable, leading to healthy cash flow generation.
Peer comparison
Sep 30, 2024