Hertz Global Holdings Inc (HTZ)
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 | — | 26.23 | 29.13 | 166.81 | 26.81 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 0.00 | 26.23 | 29.13 | 166.81 | 26.81 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + — – —
= 0.00
The cash conversion cycle of Hertz Global Holdings Inc. has shown an increasing trend over the three years under review. It has lengthened from 37.71 days at the end of 2021 to 40.93 days at the end of 2022, and further extended to 46.39 days as of December 31, 2023. This indicates that the company is taking longer to convert its investments in inventory and accounts receivable into cash.
A longer cash conversion cycle can be a sign of inefficiency in managing working capital, as it suggests that the company is taking more time to sell its inventory and collect payments from customers. This may result in increased holding costs and potential liquidity challenges.
Monitoring and managing the cash conversion cycle is important for Hertz Global Holdings Inc. to optimize working capital management and improve cash flow efficiency. Analyzing the underlying reasons for the increase in the cash conversion cycle can help the company identify areas for improvement and implement strategies to shorten the cycle and enhance overall financial performance.
Peer comparison
Dec 31, 2023