HF Sinclair Corp (DINO)

Cash conversion cycle

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022
Days of inventory on hand (DOH)	days	40.43	42.26	41.76	40.91	37.64
Days of sales outstanding (DSO)	days	20.46	21.89	18.31	15.91	16.86
Number of days of payables	days	30.52	31.92	25.65	25.02	27.33
Cash conversion cycle	days	30.37	32.24	34.42	31.80	27.16

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 40.43 + 20.46 – 30.52
= 30.37

The cash conversion cycle of HF Sinclair Corp. has shown fluctuations over the past 8 quarters, ranging from 27.24 days to 44.12 days. The trend indicates some variability in the company's ability to convert its resources effectively into cash.

In Q4 2022, the company exhibited the most efficient cash conversion cycle at 27.24 days, suggesting that they were able to efficiently manage their cash inflows and outflows during that period. However, in Q2 2022, the cash conversion cycle increased to 44.12 days, indicating a longer period for the company to convert its investments into cash.

The fluctuations in the cash conversion cycle could be influenced by various factors such as changes in sales terms, inventory management practices, and payment policies with suppliers and customers. It is crucial for HF Sinclair Corp. to closely monitor and manage its cash conversion cycle to ensure efficient working capital management and profitability.

Overall, the analysis of the cash conversion cycle for HF Sinclair Corp. highlights the importance of effective cash flow management in maintaining financial health and sustainable operations.