HP Inc (HPQ)
Cash conversion cycle
| Oct 31, 2024 | Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 67.51 | 59.34 | 54.87 | 57.83 | 47.11 |
| Days of sales outstanding (DSO) | days | 49.73 | 37.96 | 7.37 | 45.12 | 48.16 |
| Number of days of payables | days | 147.81 | 121.46 | 110.28 | 117.22 | 116.16 |
| Cash conversion cycle | days | -30.57 | -24.17 | -48.04 | -14.28 | -20.90 |
October 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 67.51 + 49.73 – 147.81
= -30.57
The cash conversion cycle of HP Inc has shown significant fluctuations over the past five years. In 2024, the company's cash conversion cycle was at -30.57 days, indicating that HP was able to convert inventory into cash quickly. This was an improvement from the previous year in 2023 when the cycle was at -24.17 days.
In 2022, the cash conversion cycle was at -48.04 days, reflecting an even faster conversion of inventory into cash compared to the previous years. However, in 2021, the cycle improved further to -14.28 days, indicating that HP managed its operating cash flow more efficiently.
The cash conversion cycle in 2020 was at -20.90 days, showing a slight improvement from the previous year. Overall, the negative values of the cash conversion cycle over the past five years indicate that HP Inc has been effective in managing its inventory, accounts receivable, and accounts payable to generate cash efficiently.
Peer comparison
Oct 31, 2024