EMCOR Group Inc (EME)
Cash conversion cycle
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 3.85 | 4.15 | 3.90 | 3.78 | 3.30 | 4.04 | 3.82 | 3.01 | 2.35 | 2.92 | 3.04 | 2.38 | 2.63 | 1.90 | 1.94 | 1.63 | 1.89 | 1.84 | 1.92 | 2.02 |
| Days of sales outstanding (DSO) | days | 92.93 | 92.47 | 88.88 | 85.66 | 84.61 | 85.11 | 85.11 | 82.49 | 81.25 | 83.43 | 83.20 | 84.50 | 79.75 | 79.48 | 78.49 | 80.54 | 80.79 | 78.14 | 81.12 | 78.21 |
| Number of days of payables | days | 32.56 | 29.59 | 29.08 | 27.28 | 32.73 | 29.75 | 29.51 | 30.27 | 31.90 | 28.88 | 29.90 | 30.83 | 33.13 | 28.84 | 26.85 | 27.26 | 31.06 | 27.82 | 28.36 | 29.53 |
| Cash conversion cycle | days | 64.22 | 67.03 | 63.71 | 62.16 | 55.18 | 59.40 | 59.42 | 55.23 | 51.70 | 57.47 | 56.34 | 56.05 | 49.25 | 52.54 | 53.57 | 54.91 | 51.62 | 52.16 | 54.68 | 50.70 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 3.85 + 92.93 – 32.56
= 64.22
Emcor Group, Inc.'s cash conversion cycle has exhibited fluctuations over the past eight quarters. The cash conversion cycle represents the time it takes for a company to convert its investments in inventory and other resources into cash.
In Q4 2023, the company's cash conversion cycle was 64.22 days, indicating that it took approximately 64 days for Emcor Group to convert its investments in inventory and other operational components into cash receipts from customers. This was a slight improvement from the previous quarter (Q3 2023) where the cash conversion cycle was 67.03 days.
Looking at the trend over the previous quarters, Emcor Group's cash conversion cycle has been relatively stable, hovering between 55 to 67 days. However, the company experienced a notable increase in the cash conversion cycle compared to the same quarter in the previous year (Q4 2022), where it was 55.18 days.
Overall, Emcor Group, Inc. should continue to monitor and manage its cash conversion cycle effectively to ensure efficient working capital management and optimize cash flow within its operations. A shorter cash conversion cycle generally indicates better liquidity and operational efficiency.
Peer comparison
Dec 31, 2023