Jacobs Solutions Inc. (J)
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 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | 0.14 | 0.03 | 0.08 | 36.23 |
| Days of sales outstanding (DSO) | days | 80.62 | 79.76 | 81.59 | 82.38 | 81.72 | 82.94 | 81.23 | 82.67 | 76.37 | 79.49 | 83.48 | 87.63 | 89.67 | 86.72 | 86.91 | 89.06 | 85.71 | 81.86 | 75.62 | 69.54 |
| Number of days of payables | days | 25.60 | 26.92 | 26.50 | 24.08 | 23.35 | 24.80 | 24.70 | 24.51 | 21.86 | 24.58 | 24.62 | 24.83 | 27.82 | 29.40 | 36.16 | 35.46 | 36.59 | 38.96 | 25.63 | 23.13 |
| Cash conversion cycle | days | 55.02 | 52.85 | 55.09 | 58.30 | 58.37 | 58.14 | 56.53 | 58.16 | 54.52 | 54.91 | 58.87 | 62.80 | 61.85 | 57.31 | 50.75 | 53.60 | 49.27 | 42.94 | 50.07 | 82.63 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 80.62 – 25.60
= 55.02
The cash conversion cycle of Jacobs Solutions Inc., a measure of how long it takes for the company to convert its investments in inventory and other resources back into cash from sales, has exhibited some fluctuation over the past few quarters.
From March 2019 to June 2019, there was a gradual increase in the cash conversion cycle from 42.94 days to 58.87 days, indicating a longer period for the company to convert its resources back into cash. This trend continued to worsen, reaching a peak of 82.63 days at the end of December 2019.
From March 2020 onwards, the cash conversion cycle started to improve, with a significant decrease to 50.07 days by the end of that quarter. The company continued this positive trend with further improvements, reaching the lowest level of 42.94 days by the end of December 2021.
However, from March 2022 to December 2023, there was a gradual increase in the cash conversion cycle, fluctuating between 54.52 days and 58.37 days. This increase indicates that Jacobs Solutions Inc. took longer to convert its investments into cash during this period.
Overall, the company needs to closely monitor its inventory management, accounts payable, and accounts receivable processes to optimize its cash conversion cycle and ensure efficient cash flow management.
Peer comparison
Dec 31, 2023