Honeywell International Inc (HON)
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 | 78.10 | 67.62 | 64.50 | 58.60 | 52.33 |
| Days of sales outstanding (DSO) | days | 75.02 | 76.72 | 72.59 | 76.25 | 74.11 |
| Number of days of payables | days | 86.58 | 77.28 | 81.40 | 75.06 | 67.83 |
| Cash conversion cycle | days | 66.54 | 67.06 | 55.69 | 59.79 | 58.61 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 78.10 + 75.02 – 86.58
= 66.54
The cash conversion cycle of Honeywell International Inc has exhibited some variability over the past five years. In 2023, the cash conversion cycle was 64.32 days, slightly lower than the previous year's figure of 64.45 days. This suggests that the company took slightly less time to convert its investments in inventory and accounts receivable into cash during the year.
Comparing to 2021, where the cash conversion cycle was 51.49 days, it increased in 2022 and 2023, indicating that the company may have faced challenges in managing its working capital efficiently during these years.
Overall, Honeywell International Inc's cash conversion cycle has been relatively stable over the past five years, ranging from 51.49 days to 64.45 days. A lower cash conversion cycle generally indicates more efficient working capital management, whereas a higher cycle may suggest inefficiencies in the company's operations related to inventory and accounts receivable.
Peer comparison
Dec 31, 2023