National Vision Holdings Inc (EYE)
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 | 23.06 | 23.66 | 25.40 | 26.36 | 23.09 | 23.02 | 24.61 | 24.16 | 23.67 | 24.18 | 23.94 | 26.45 | 24.99 | 29.79 | 31.67 | 32.50 | 32.24 | 28.56 | 27.60 | 30.28 |
| Days of sales outstanding (DSO) | days | 14.90 | 14.13 | 14.00 | — | 14.53 | — | — | — | 9.77 | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | 12.99 | 12.34 | 13.47 | 15.92 | 12.24 | 13.01 | 13.30 | 13.17 | 12.31 | 14.77 | 15.39 | 17.66 | 14.57 | 18.31 | 14.09 | 14.95 | 10.31 | 11.57 | 12.30 | 12.19 |
| Cash conversion cycle | days | 24.97 | 25.46 | 25.93 | 10.43 | 25.38 | 10.01 | 11.30 | 11.00 | 21.13 | 9.41 | 8.55 | 8.79 | 10.42 | 11.49 | 17.58 | 17.56 | 21.94 | 16.99 | 15.30 | 18.08 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 23.06 + 14.90 – 12.99
= 24.97
The cash conversion cycle of National Vision Holdings Inc has shown some fluctuations over the past few quarters. The cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
From December 2019 to September 2020, the cash conversion cycle varied between 15.3 days and 21.94 days, indicating some inconsistency in the company's efficiency in managing its cash flow. However, from September 2020 to December 2023, the cycle generally ranged between 8.55 days to 25.93 days with occasional spikes and drops.
The company seems to have improved its cash conversion efficiency in the beginning of 2021, with the cycle decreasing to around 8-9 days. However, there was a noticeable increase in the cash conversion cycle in the following quarters of 2021 and 2022, reaching up to 25.38 days in December 2022.
Overall, National Vision Holdings Inc has shown variability in its cash conversion cycle, which may indicate challenges in managing its working capital efficiently. The company should focus on optimizing its inventory turnover, accounts receivable collection, and accounts payable management to enhance its cash conversion efficiency and strengthen its financial position.
Peer comparison
Dec 31, 2023