Encompass Health Corp (EHC)
Cash conversion cycle
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | 6.86 | 57.07 | 113.53 | 119.06 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 0.00 | 6.86 | 57.07 | 113.53 | 119.06 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + — – —
= 0.00
The cash conversion cycle of Encompass Health Corp has shown a decreasing trend over the years, indicating improved efficiency in managing its working capital. As of December 31, 2020, the cash conversion cycle stood at 119.06 days, which decreased to 113.53 days by December 31, 2021. Subsequently, there was a significant reduction to 57.07 days by December 31, 2022. The trend continued with a notable decrease to 6.86 days by December 31, 2023, and reached 0.00 days by December 31, 2024.
This steady decline in the cash conversion cycle reflects the company's ability to convert its investments in inventory and receivables into cash quickly. A lower cash conversion cycle signifies that Encompass Health Corp is managing its resources more efficiently, potentially leading to improved liquidity and operating performance.
Peer comparison
Dec 31, 2024