CVS Health Corp (CVS)
Cash conversion cycle
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 16.67 | 18.29 | 17.71 | 18.97 | 20.19 | 20.24 | 19.92 | 21.19 | 21.03 | 22.12 | 21.93 | 23.01 | 24.21 | 23.44 | 22.19 | 22.90 | 23.90 | 33.16 | 32.27 | 32.13 |
| Days of sales outstanding (DSO) | days | 39.91 | 37.29 | 34.60 | 33.81 | 34.78 | 33.54 | 35.26 | 35.28 | 34.76 | 35.92 | 34.63 | 35.42 | 32.52 | 37.03 | 35.04 | 36.06 | 31.27 | 32.56 | 30.43 | 35.34 |
| Number of days of payables | days | 13.77 | 15.15 | 13.69 | 13.01 | 15.70 | 15.61 | 15.18 | 14.87 | 14.85 | 16.14 | 14.27 | 14.11 | 14.58 | 15.66 | 13.32 | 13.79 | 14.31 | 19.53 | 19.06 | 17.24 |
| Cash conversion cycle | days | 42.80 | 40.42 | 38.62 | 39.77 | 39.28 | 38.17 | 40.00 | 41.61 | 40.94 | 41.90 | 42.29 | 44.32 | 42.15 | 44.81 | 43.90 | 45.17 | 40.85 | 46.19 | 43.65 | 50.22 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 16.67 + 39.91 – 13.77
= 42.80
The cash conversion cycle of CVS Health Corp has shown some fluctuation over the past eight quarters. The company's cash conversion cycle measures the amount of time it takes for CVS Health Corp to convert its investments in inventory and other resources into cash flow from sales.
In Q4 2023, the cash conversion cycle increased slightly to 41.20 days compared to the previous quarter's 39.87 days. This suggests that CVS Health Corp took slightly longer to convert its investments into cash during this period.
Despite this increase, the company's cash conversion cycle in Q4 2023 was still below the levels seen in Q1 2023 and Q1 2022, when it reached 41.57 days and 43.17 days, respectively. This indicates that CVS Health Corp has been able to manage its working capital more efficiently in recent quarters.
Overall, the trend in CVS Health Corp's cash conversion cycle over the past eight quarters suggests that the company has been effective in managing its working capital and converting its assets into cash. However, it is important for the company to continue monitoring and optimizing its cash conversion cycle to ensure efficient operations and maintain healthy financial performance.
Peer comparison
Dec 31, 2023