Flowserve Corporation (FLS)
Cash conversion cycle
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 98.47 | 100.87 | 99.31 | 103.90 | 105.52 | 112.90 | 118.42 | 119.58 | 111.86 | 112.47 | 108.96 | 105.62 | 99.37 | 100.75 | 98.58 | 94.60 | 93.12 | 98.64 | 93.64 | 93.10 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 98.47 | 100.87 | 99.31 | 103.90 | 105.52 | 112.90 | 118.42 | 119.58 | 111.86 | 112.47 | 108.96 | 105.62 | 99.37 | 100.75 | 98.58 | 94.60 | 93.12 | 98.64 | 93.64 | 93.10 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 98.47 + — – —
= 98.47
Flowserve Corporation's cash conversion cycle provides insights into how efficiently the company manages its working capital. The cash conversion cycle represents the time it takes for the company to convert its investments in inventory and accounts receivable into cash inflows from customers.
Looking at the data provided, we can see that Flowserve Corporation's cash conversion cycle has shown some fluctuation over the analysis period. The cycle ranged from a low of 93.10 days in March 2020 to a high of 119.58 days in March 2023.
Typically, a shorter cash conversion cycle indicates that the company is able to quickly turn its investments into cash, which is a positive sign of operational efficiency. On the other hand, a longer cash conversion cycle may suggest inefficiencies in managing working capital.
In the case of Flowserve Corporation, the trend in the cash conversion cycle shows some volatility, with periods of increase and decrease. It is important for the company to closely monitor and manage its inventory levels, accounts receivable, and accounts payable to optimize its cash conversion cycle.
Overall, a detailed analysis of the drivers behind the fluctuations in the cash conversion cycle, such as changes in inventory management, credit policies, and supplier payment terms, would help provide a comprehensive understanding of Flowserve Corporation's working capital management efficiency.
Peer comparison
Dec 31, 2024