The Ensign Group Inc (ENSG)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | 0.67 | — | — | — |
| Days of sales outstanding (DSO) | days | 47.57 | 49.27 | 45.67 | 46.34 | 55.58 |
| Number of days of payables | days | 10.57 | 11.19 | 9.76 | 9.29 | 9.44 |
| Cash conversion cycle | days | 37.01 | 38.76 | 35.91 | 37.05 | 46.14 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 47.57 – 10.57
= 37.01
The cash conversion cycle of Ensign Group Inc has demonstrated a relatively stable trend over the past five years. The company's ability to efficiently convert its resources into cash indicates operational effectiveness and liquidity management.
In 2023, the cash conversion cycle decreased to 35.95 days from 37.32 days in 2022, showcasing an improvement in the company's cash conversion efficiency. This reduction suggests that Ensign Group Inc was able to streamline its operations and convert its investments in inventory and accounts receivable into cash at a faster rate.
Comparing to previous years, the cash conversion cycle in 2021 was 35.16 days, which was slightly lower than in 2020 at 36.38 days. This indicates that the company managed its working capital more effectively in 2021 than in the prior year.
However, in 2019, the cash conversion cycle was significantly higher at 45.25 days, demonstrating a less efficient cash conversion process. Subsequent improvements in the following years reflect Ensign Group Inc's efforts to enhance its liquidity position and operational performance.
Overall, Ensign Group Inc's cash conversion cycle analysis suggests that the company has been successful in managing its working capital and converting its assets into cash efficiently over the past five years.
Peer comparison
Dec 31, 2023