Incyte Corporation (INCY)
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 | 90.14 | 85.42 | 54.85 | 67.45 | 74.05 | 87.33 | 112.40 | 78.82 | 67.45 | 54.21 | 44.14 | 45.75 | 45.65 | 48.81 | 48.50 | 42.88 | 36.42 | 24.92 | 23.09 | 26.39 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | 156.89 | 208.20 | 237.64 | 91.80 | 489.40 | 310.67 | 401.66 | 338.71 | 416.05 | 291.38 | 323.20 | 233.03 | 274.50 | 351.49 | 269.91 | 186.94 | 267.23 | 321.15 | 234.18 | 260.46 |
| Cash conversion cycle | days | -66.75 | -122.78 | -182.79 | -24.35 | -415.35 | -223.34 | -289.26 | -259.89 | -348.60 | -237.17 | -279.06 | -187.28 | -228.85 | -302.68 | -221.41 | -144.06 | -230.81 | -296.23 | -211.09 | -234.07 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 90.14 + — – 156.89
= -66.75
The cash conversion cycle of Incyte Corp. has shown significant fluctuations over the past eight quarters. In Q4 2023, the cash conversion cycle was 6.69 days, indicating that the company took approximately 6.69 days to convert its invested resources into cash flows. This represents an improvement compared to the previous quarter where the cycle was negative at -56.30 days, suggesting that the company was able to convert its investments into cash more efficiently in Q4 2023.
Looking back over the last few quarters, Incyte Corp. experienced negative cash conversion cycles in Q3 2023, Q4 2022, and Q3 2022. This implies that the company was able to generate cash from its operations before needing to pay its suppliers or other obligations, reflecting strong liquidity management. However, in Q1 2023, Q2 2023, Q1 2022, and Q2 2022, the company had positive cash conversion cycles, indicating that it took longer to convert investments into cash during those periods.
Overall, Incyte Corp.'s cash conversion cycle has been volatile, with fluctuations between positive and negative cycles in recent quarters. It is important for the company to focus on improving efficiency in managing its working capital and optimizing the cash conversion cycle to ensure healthy liquidity and operational effectiveness.
Peer comparison
Dec 31, 2023