Humana Inc (HUM)

Cash conversion cycle

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Days of inventory on hand (DOH)	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Days of sales outstanding (DSO)	days	6.98	6.50	5.28	11.86	6.58	6.42	13.76	13.41	7.97	8.46	11.06	10.16	5.38	5.57	11.58	10.83	5.94	4.93	5.43	12.15
Number of days of payables	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Cash conversion cycle	days	6.98	6.50	5.28	11.86	6.58	6.42	13.76	13.41	7.97	8.46	11.06	10.16	5.38	5.57	11.58	10.83	5.94	4.93	5.43	12.15

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 6.98 – —
= 6.98

The cash conversion cycle of Humana Inc. has shown fluctuations in recent quarters. In Q1 2023 and Q4 2022, the company had longer cash conversion cycles of 11.86 days and 6.58 days, respectively, indicating that it took longer for the company to convert its investments in inventory back into cash during these periods.

However, in Q2 2023 and Q3 2023, the company managed to reduce its cash conversion cycle to 5.28 days and 6.50 days, respectively, indicating an improvement in efficiency in managing its working capital.

Overall, it is important for Humana Inc. to monitor its cash conversion cycle closely to ensure optimal management of its cash flow and working capital. A shorter cash conversion cycle typically indicates better liquidity and efficiency in converting investments back into cash, which is beneficial for the company's financial health.