Five Below Inc (FIVE)

Cash conversion cycle

		Jan 31, 2025	Oct 31, 2024	Jul 31, 2024	Apr 30, 2024	Feb 3, 2024	Jan 31, 2024	Oct 31, 2023	Oct 28, 2023	Jul 31, 2023	Jul 29, 2023	Apr 30, 2023	Apr 29, 2023	Jan 31, 2023	Jan 28, 2023	Oct 31, 2022	Oct 29, 2022	Jul 31, 2022	Jul 30, 2022	Apr 30, 2022	Jan 31, 2022
Days of inventory on hand (DOH)	days	92.63	107.96	77.79	78.85	69.94	83.63	114.72	115.78	82.70	77.05	69.38	70.74	72.19	78.19	119.67	119.92	98.43	83.21	80.39	68.33
Days of sales outstanding (DSO)	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Number of days of payables	days	—	—	—	—	30.66	—	—	52.98	—	35.31	—	31.04	—	32.76	—	47.83	—	38.90	—	—
Cash conversion cycle	days	92.63	107.96	77.79	78.85	39.28	83.63	114.72	62.79	82.70	41.75	69.38	39.70	72.19	45.43	119.67	72.08	98.43	44.31	80.39	68.33

January 31, 2025 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 92.63 + — – —
= 92.63

The cash conversion cycle (CCC) of Five Below Inc shows fluctuations over the periods analyzed. The CCC indicates the time it takes for a company to convert its investments in inventory into cash flows from sales.

The trend in the CCC for Five Below Inc fluctuates between 39.28 days and 119.67 days. A lower CCC typically indicates that the company is efficient in managing its working capital by quickly selling inventory and collecting cash from customers. Conversely, a higher CCC may suggest inefficiency or possible issues with inventory management or collection of receivables.

Analyzing the data, we observe that the CCC ranged from a low of 39.28 days on February 3, 2024, to a high of 119.67 days on October 31, 2022. The company's most recent CCC as of January 31, 2025, stands at 92.63 days.

It is important for Five Below Inc to monitor and manage its CCC effectively to ensure optimal cash flow operations. By reducing the CCC, the company can improve its liquidity position and potentially generate more cash to reinvest in the business or return to shareholders.