Diamondback Energy Inc (FANG)

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	145.54	165.91	156.43	161.44	161.95	133.76	143.79	139.69	150.87	16.85	7.21	3.68	1.95	2.03	2.79	6.89	14.99	173.74	180.22	180.18
Days of sales outstanding (DSO)	days	36.75	44.26	35.44	37.54	38.08	29.78	41.56	49.10	36.03	53.39	57.84	74.46	56.70	45.34	47.41	36.78	56.63	56.22	61.77	65.99
Number of days of payables	days	602.94	848.51	590.16	563.88	306.99	315.12	137.15	110.40	87.60	6.68	14.42	5.03	4.20	5.83	15.53	46.89	72.51	899.57	835.58	831.58
Cash conversion cycle	days	-420.65	-638.34	-398.29	-364.90	-106.95	-151.59	48.19	78.39	99.30	63.57	50.63	73.12	54.45	41.53	34.67	-3.22	-0.90	-669.61	-593.59	-585.42

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 145.54 + 36.75 – 602.94
= -420.65

The cash conversion cycle for Diamondback Energy Inc has fluctuated over the past eight quarters. In Q4 2023, the company's cash conversion cycle was 36.75 days, a decrease from Q3 2023's cycle of 44.26 days. This suggests that Diamondback Energy improved its efficiency in converting investments in inventory and other resources into cash during this period.

Comparing Q4 2023 to the same quarter in the previous year, there was a slight decrease from 38.08 days in Q4 2022. This indicates that Diamondback Energy has been able to manage its working capital more effectively compared to the prior year.

Overall, while there have been fluctuations in the cash conversion cycle of Diamondback Energy Inc over the past eight quarters, the trend appears to show improvement in managing working capital efficiency. Investors and stakeholders may view this positively as it could indicate better liquidity and operational efficiency within the company.