HP Inc (HPQ)
Cash conversion cycle
| Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | Jan 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 67.51 | 68.48 | 66.42 | 60.94 | 59.34 | 60.44 | 58.76 | 55.80 | 54.87 | 57.55 | 62.67 | 64.10 | 57.83 | 60.53 | 55.61 | 52.03 | 47.11 | 46.68 | 50.52 | 38.22 |
| Days of sales outstanding (DSO) | days | 49.73 | 42.48 | 41.43 | 35.90 | 37.96 | 41.62 | 35.35 | 34.19 | 7.37 | 37.19 | 39.98 | 42.91 | 45.12 | 41.90 | 41.53 | 47.84 | 48.16 | 46.90 | 46.28 | 38.13 |
| Number of days of payables | days | 147.81 | 135.80 | 126.99 | 116.59 | 121.46 | 118.61 | 108.37 | 102.67 | 110.28 | 108.99 | 119.14 | 128.44 | 117.22 | 117.85 | 112.88 | 116.73 | 116.16 | 113.02 | 112.87 | 98.97 |
| Cash conversion cycle | days | -30.57 | -24.84 | -19.14 | -19.75 | -24.17 | -16.54 | -14.26 | -12.68 | -48.04 | -14.25 | -16.49 | -21.43 | -14.28 | -15.42 | -15.74 | -16.86 | -20.90 | -19.44 | -16.07 | -22.62 |
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 for HP Inc has shown some fluctuations over the past few quarters. It refers to the number of days it takes for the company to convert its investments in inventory and other resources into cash flows from sales.
From Oct 2020 to Oct 2024, HP Inc's cash conversion cycle has varied from -48.04 days to -12.68 days, indicating that the company has been efficient in managing its working capital and generating cash from its operating activities. A negative cash conversion cycle suggests that HP Inc is able to collect cash from customers before paying its suppliers, which can be advantageous for its liquidity position.
However, there have been instances where the cash conversion cycle has fluctuated, such as from Oct 2022 to Jul 2023 and from Jan 2022 to Jul 2022, showing some inconsistencies in the company's working capital management.
Overall, while HP Inc has generally maintained a negative cash conversion cycle, indicating efficient management of working capital, it is important for the company to focus on minimizing fluctuations to ensure stable and consistent cash flow generation from its operations.
Peer comparison
Oct 31, 2024