Generac Holdings Inc (GNRC)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 122.90 | 133.17 | 136.45 | 114.19 | 107.87 |
| Days of sales outstanding (DSO) | days | 49.97 | 42.41 | 53.86 | 55.80 | 53.95 |
| Number of days of payables | days | 35.87 | 42.27 | 84.42 | 62.51 | 54.14 |
| Cash conversion cycle | days | 137.00 | 133.32 | 105.89 | 107.49 | 107.69 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 122.90 + 49.97 – 35.87
= 137.00
Generac Holdings Inc's cash conversion cycle has shown variations over the past five years. The cycle increased from 120.39 days in 2019 to 162.32 days in 2023. This indicates a lengthening in the time it takes for the company to convert its investments in inventory and other resources into cash receipts from customers.
In 2021, there was a significant decrease in the cash conversion cycle to 117.17 days, showing an improvement in the company's efficiency in managing its working capital. However, this improvement was not sustained as the cycle increased in subsequent years.
Overall, the trend in Generac Holdings Inc's cash conversion cycle shows some inconsistency, with periods of both improvement and deterioration in working capital management efficiency. Further analysis and evaluation of the company's operational and financial strategies may be required to address the fluctuations in the cash conversion cycle.
Peer comparison
Dec 31, 2023