Granite Construction Incorporated (GVA)
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 | 11.49 | 11.43 | 13.07 | 13.33 | 12.18 | 11.34 | 11.58 | 12.76 | 11.44 | 10.96 | 10.39 | 9.30 | 7.47 | 8.73 | 9.99 | 9.84 | 9.34 | 12.90 | 13.01 | 12.17 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 11.49 | 11.43 | 13.07 | 13.33 | 12.18 | 11.34 | 11.58 | 12.76 | 11.44 | 10.96 | 10.39 | 9.30 | 7.47 | 8.73 | 9.99 | 9.84 | 9.34 | 12.90 | 13.01 | 12.17 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 11.49 + — – —
= 11.49
Granite Construction Incorporated's cash conversion cycle has shown some fluctuations over the period analyzed. The cash conversion cycle, which reflects the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales, was on a downward trend from March 2021 to December 2021, indicating improved efficiency in managing its working capital.
However, in the following periods from March 2022 to March 2024, the cash conversion cycle started to increase gradually, indicating potential challenges in managing its working capital efficiently. This increase suggests that the company may be taking longer to convert its investments into cash, which could potentially tie up funds and impact its liquidity position.
Overall, Granite Construction Incorporated should closely monitor its cash conversion cycle and take necessary steps to optimize its working capital management, potentially by streamlining inventory processes, enhancing accounts receivable collection efficiency, or negotiating better payment terms with suppliers. By improving its cash conversion cycle, the company can enhance its liquidity and overall financial health.
Peer comparison
Dec 31, 2024