Domino’s Pizza Inc (DPZ)
Cash conversion cycle
| Dec 31, 2023 | Sep 10, 2023 | Jun 18, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 11, 2022 | Jun 19, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 12, 2021 | Jun 20, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 6, 2020 | Jun 14, 2020 | Mar 22, 2020 | Dec 31, 2019 | Sep 8, 2019 | Jun 16, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 11.00 | 9.19 | 8.48 | 8.77 | 10.31 | 9.31 | 9.25 | 10.44 | 9.34 | 8.88 | 8.16 | 9.01 | 9.65 | 9.94 | 10.59 | 8.00 | 8.72 | 8.54 | 7.46 | 7.72 |
| Days of sales outstanding (DSO) | days | 23.04 | 20.42 | 21.04 | 20.79 | 20.71 | — | — | 20.56 | 21.39 | — | — | 20.36 | 21.68 | — | — | — | — | — | — | — |
| Number of days of payables | days | 14.09 | 13.32 | 11.71 | 11.84 | 11.34 | 11.71 | 13.10 | 12.41 | 12.52 | 15.38 | 14.42 | 13.42 | 13.67 | 13.39 | 16.30 | 15.43 | 18.30 | 16.01 | 13.89 | 14.36 |
| Cash conversion cycle | days | 19.95 | 16.28 | 17.81 | 17.72 | 19.69 | -2.40 | -3.85 | 18.59 | 18.21 | -6.50 | -6.25 | 15.94 | 17.66 | -3.44 | -5.71 | -7.43 | -9.58 | -7.47 | -6.43 | -6.63 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 11.00 + 23.04 – 14.09
= 19.95
The cash conversion cycle of Dominos Pizza Inc has shown a relatively stable trend over the past eight quarters, ranging between 16.28 days to 19.95 days. This metric reflects the average number of days it takes for the company to convert its investments in inventory and other resources into cash receipts from customers.
A lower cash conversion cycle can indicate more efficient management of working capital and better liquidity. Dominos Pizza Inc has shown a generally positive trend in this regard, with the cycle decreasing from 19.69 days in Q4 2022 to 16.28 days in Q3 2023, before slightly increasing in the most recent quarter to 19.95 days.
Overall, the company appears to be effectively managing its working capital and converting it into cash, thereby potentially improving its financial health and operational efficiency. Further analysis and comparison with industry benchmarks would provide additional insights into Dominos Pizza Inc's performance in this area.
Peer comparison
Dec 31, 2023