Fortive Corp (FTV)

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	38.78	41.07	41.93	42.70	39.82	41.18	41.86	42.70	40.80	43.51	43.36	44.71	42.27	64.16	53.12	47.23	40.44	39.08	39.13	36.96
Days of sales outstanding (DSO)	days	55.55	54.21	56.17	58.18	59.20	57.58	58.54	59.40	61.28	58.68	—	—	64.61	—	—	—	46.35	62.44	58.42	65.46
Number of days of payables	days	48.22	45.43	46.63	49.05	45.14	42.84	43.68	44.41	47.37	44.45	—	—	46.00	—	—	—	42.69	45.89	43.17	42.36
Cash conversion cycle	days	46.11	49.85	51.48	51.83	53.88	55.92	56.72	57.70	54.72	57.74	43.36	44.71	60.89	64.16	53.12	47.23	44.10	55.63	54.39	60.06

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 38.78 + 55.55 – 48.22
= 46.11

The cash conversion cycle of Fortive Corp has shown fluctuations over the quarters presented in the data. The cash conversion cycle represents the time it takes for a company to convert its investments in inventory and other resources into cash flow from sales.

From March 31, 2020, to June 30, 2021, the cash conversion cycle decreased from 60.06 days to 53.12 days, indicating an improvement in the efficiency of Fortive Corp's working capital management. However, from September 30, 2021, to December 31, 2024, the cycle fluctuated within a range of 43.36 days to 60.89 days, showing some variability in the company's ability to efficiently manage its cash flow.

Overall, the trend in the cash conversion cycle for Fortive Corp appears to exhibit some volatility, with periodic improvements and setbacks in working capital efficiency. Analyzing the factors contributing to these fluctuations could provide insights into the company's operational effectiveness and liquidity management strategies.