Fortive Corp (FTV)

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	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	24.47	56.71	64.99	64.85
Days of sales outstanding (DSO)	days	59.20	57.58	58.54	59.40	61.28	58.68	—	—	64.61	—	—	—	46.35	62.44	58.42	65.46	69.76	77.69	76.88	66.65
Number of days of payables	days	45.14	42.84	43.68	44.41	47.37	44.45	—	—	46.00	—	—	—	42.69	45.89	43.17	42.36	45.00	57.81	65.38	71.20
Cash conversion cycle	days	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	49.22	76.60	76.49	60.30

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 39.82 + 59.20 – 45.14
= 53.88

The cash conversion cycle of Fortive Corp has shown some fluctuations over the past eight quarters. In the most recent quarter, Q4 2023, the company's cash conversion cycle was 47.23 days, representing an improvement from the previous quarter. This indicates that Fortive Corp was able to manage its cash, inventory, and receivables more efficiently in turning them into cash during this period.

Looking back over the last two years, the trend in the cash conversion cycle has been somewhat volatile, with periods of increases and decreases. Despite some fluctuations, the company has generally maintained a cycle duration ranging from approximately 47 to 60 days.

It is crucial for Fortive Corp to continue monitoring and managing its cash conversion cycle effectively to ensure optimal utilization of resources, timely collection of receivables, and efficient management of inventory. Overall, the company's ability to effectively manage its cash conversion cycle can positively impact its liquidity position and operational efficiency.