Huntington Ingalls Industries Inc (HII)
Cash conversion cycle
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 70.17 | 59.03 | 62.78 | 59.72 | 51.39 |
| Days of sales outstanding (DSO) | days | 13.16 | 20.52 | 27.56 | 24.60 | 22.15 |
| Number of days of payables | days | 201.73 | 175.83 | 220.23 | 223.67 | 172.56 |
| Cash conversion cycle | days | -118.40 | -96.28 | -129.90 | -139.35 | -99.02 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 70.17 + 13.16 – 201.73
= -118.40
The cash conversion cycle for Huntington Ingalls Industries Inc has shown some fluctuations over the past five years. In the fiscal year ending December 31, 2020, the company had a negative cash conversion cycle of -99.02 days, indicating that it was able to convert its inventory and accounts receivable into cash relatively quickly.
However, in the following years, the cash conversion cycle lengthened, reaching -139.35 days by December 31, 2021, and then decreasing to -129.90 days by December 31, 2022. This suggests that the company's ability to convert its resources into cash slightly improved in 2022 compared to 2021.
By December 31, 2023, the cash conversion cycle improved further to -96.28 days before slightly increasing to -118.40 days by December 31, 2024. Overall, the company has maintained a negative cash conversion cycle, indicating efficiency in managing its working capital and generating cash from its operations.
It's worth noting that a negative cash conversion cycle suggests that Huntington Ingalls Industries Inc is able to collect cash from customers more quickly than it pays its suppliers, which can be a positive indicator of its operational efficiency and liquidity management.
Peer comparison
Dec 31, 2024