Lear Corporation (LEA)
Cash conversion cycle
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 26.97 | 29.67 | 29.48 | 32.10 | 32.09 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 26.97 | 29.67 | 29.48 | 32.10 | 32.09 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 26.97 + — – —
= 26.97
The cash conversion cycle of Lear Corporation has shown a consistent improvement from 32.09 days at the end of 2020 to 26.97 days at the end of 2024. This indicates that the company has been able to generate cash more efficiently from its operating cycle over the years. A lower cash conversion cycle signifies that Lear Corporation is managing its inventories, receivables, and payables effectively, leading to quicker conversion of invested cash back into cash inflows. This trend reflects positively on the company's liquidity and operational efficiency. Moving forward, Lear Corporation should continue monitoring and managing its working capital components to sustain this improvement in cash conversion cycle.
Peer comparison
Dec 31, 2024