Designer Brands Inc (DBI)
Cash conversion cycle
| Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 30, 2021 | Oct 31, 2020 | Aug 1, 2020 | May 2, 2020 | Feb 1, 2020 | Nov 2, 2019 | Aug 3, 2019 | May 4, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 99.30 | 104.96 | 103.46 | 106.44 | 98.86 | 109.83 | 113.76 | 111.79 | 100.59 | 108.05 | 92.91 | 103.68 | 89.79 | 96.13 | 72.32 | 81.55 | 92.62 | 98.81 | 107.24 | 99.81 |
| Days of sales outstanding (DSO) | days | 9.92 | 12.67 | 11.25 | 11.34 | 8.56 | 24.72 | 22.22 | 24.41 | 22.82 | 28.31 | 26.15 | 31.73 | 32.02 | 9.19 | 6.57 | 9.64 | 9.32 | 9.09 | 9.13 | 8.55 |
| Number of days of payables | days | 50.29 | 54.12 | 50.25 | 48.18 | 41.68 | 50.90 | 55.33 | 61.36 | 58.47 | 72.01 | 55.14 | 65.62 | 46.50 | 65.39 | 36.51 | 43.26 | 43.79 | 38.83 | 43.96 | 34.91 |
| Cash conversion cycle | days | 58.93 | 63.51 | 64.46 | 69.60 | 65.74 | 83.65 | 80.65 | 74.84 | 64.94 | 64.35 | 63.92 | 69.80 | 75.31 | 39.93 | 42.38 | 47.94 | 58.15 | 69.07 | 72.42 | 73.45 |
February 3, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 99.30 + 9.92 – 50.29
= 58.93
The cash conversion cycle of Designer Brands Inc has shown some fluctuations over the past few years, ranging from a low of 39.93 days to a high of 83.65 days. The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
A lower cash conversion cycle indicates that the company is able to efficiently manage its working capital, meaning it can convert inventory into sales and receive cash from customers quickly. On the other hand, a higher cash conversion cycle suggests that the company may be experiencing delays in selling inventory or collecting payments from customers.
Analyzing the trend, it appears that the company has experienced some variability in its cash conversion cycle, with periods of both shorter and longer cycles. It is important for the company to monitor and manage its working capital effectively to ensure a healthy cash conversion cycle, which can impact the overall financial health and liquidity of the business.
Peer comparison
Feb 3, 2024