Enhabit Inc. (EHAB)
Cash conversion cycle
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | ||
|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | 1.10 | 0.64 | 1.44 | |||
| Days of sales outstanding (DSO) | days | 61.02 | 61.67 | 54.14 | 56.59 | |||
| Number of days of payables | days | 2.55 | 1.84 | 1.66 | 2.07 | |||
| Cash conversion cycle | days | 58.48 | 60.93 | 53.13 | 55.95 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 61.02 – 2.55
= 58.48
The cash conversion cycle of Enhabit Inc. has shown a fluctuating trend over the past four quarters. The cycle ranged from 53.13 days to 60.93 days during this period. The longest cycle occurred in September 2023 at 60.93 days, indicating that the company took longer to convert its investments in inventory and other resources back into cash during that quarter. Conversely, the shortest cycle was observed in June 2023, lasting 53.13 days.
Overall, Enhabit Inc. experienced slight variability in its cash conversion cycle, suggesting potential challenges in efficiently managing its working capital and cash flow. Emphasis on optimizing inventory levels, accounts receivable collection, and accounts payable management could help the company shorten its cash conversion cycle and enhance its overall liquidity position in the future.
Peer comparison
Dec 31, 2023