The Ensign Group Inc (ENSG)
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 | — | — | — | — | 0.67 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | 47.45 | 48.49 | 48.05 | 50.66 | 49.27 | 44.39 | 44.05 | 45.73 | 45.67 | 44.64 | 45.85 | 46.71 | 46.34 | 51.28 | 52.72 | 57.91 | 55.50 | 49.96 | 50.13 | 34.52 |
| Number of days of payables | days | 10.57 | 9.40 | 10.04 | 11.14 | 11.19 | 9.59 | 9.47 | 9.22 | 9.76 | 9.83 | 10.35 | 9.70 | 9.29 | 10.65 | 8.86 | 8.47 | 9.44 | 7.57 | 8.77 | 9.09 |
| Cash conversion cycle | days | 36.88 | 39.09 | 38.01 | 39.52 | 38.75 | 34.79 | 34.58 | 36.51 | 35.91 | 34.81 | 35.51 | 37.01 | 37.05 | 40.64 | 43.85 | 49.44 | 46.06 | 42.39 | 41.36 | 25.43 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 47.45 – 10.57
= 36.88
The cash conversion cycle of Ensign Group Inc has shown some fluctuations over the past eight quarters. The company experienced a peak cash conversion cycle of 38.77 days in Q1 2023 and a low of 33.90 days in Q2 2022. Generally, the company takes about 35 to 38 days to convert its investments in inventory to cash received from customers.
A shorter cash conversion cycle indicates that the company is efficiently managing its working capital and turning its inventory into cash quickly. On the other hand, a longer cash conversion cycle may suggest inefficiencies in managing inventory, accounts receivable, or accounts payable.
Overall, Ensign Group Inc should focus on maintaining a reasonable cash conversion cycle to optimize its working capital management and ensure healthy liquidity levels. Additionally, monitoring trends in the cash conversion cycle can provide valuable insights into the company's operational efficiency and effectiveness in managing its cash flows.
Peer comparison
Dec 31, 2023