Gentex Corporation (GNTX)

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	88.02	89.12	90.10	97.31	102.69	111.15	111.77	107.09	94.17	84.54	74.69	70.99	69.11	73.35	80.78	71.67	71.09	67.44	64.60	65.53
Days of sales outstanding (DSO)	days	51.09	58.16	60.29	60.70	52.59	57.84	57.20	59.88	52.67	47.82	44.60	59.01	61.62	61.18	38.81	46.24	46.23	49.45	44.65	38.90
Number of days of payables	days	40.33	38.62	38.91	40.43	38.54	45.55	53.13	41.59	29.28	29.05	28.66	32.61	25.89	28.37	18.72	28.58	27.86	26.93	25.84	26.21
Cash conversion cycle	days	98.78	108.66	111.47	117.59	116.75	123.44	115.83	125.37	117.56	103.31	90.63	97.38	104.84	106.16	100.87	89.32	89.46	89.96	83.41	78.22

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 88.02 + 51.09 – 40.33
= 98.78

The cash conversion cycle of Gentex Corp. for the past eight quarters has varied over the range of 102.89 to 132.25 days. The company's cash conversion cycle represents the number of days it takes for Gentex Corp. to convert its investments in inventory and other resources back into cash flow from sales.

The data shows that Gentex Corp. has been able to reduce its cash conversion cycle from Q1 2022 to Q4 2023, indicating improved efficiency in managing its working capital. A lower cash conversion cycle suggests that the company is managing its inventory, accounts receivable, and accounts payable effectively to generate cash more quickly from its operations.

The trend of decreasing cash conversion cycle from Q1 2022 to Q4 2023 is generally positive, as it indicates that Gentex Corp. has been able to optimize its working capital and improve its cash flow management over time. This can potentially lead to better liquidity and financial health for the company. However, it is important for Gentex Corp. to continue monitoring and improving its cash conversion cycle to ensure efficient use of its resources and sustainable operations.