Lennar Corporation (LEN)
Cash conversion cycle
| Nov 30, 2024 | Aug 31, 2024 | May 31, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | 17,115.62 | 18,642.88 | 20,366.19 | — | 12,180.66 | 11,954.73 | 12,284.89 | — | 16,321.95 | 16,447.68 | 15,800.21 | — | 1,257.00 | 668.24 | 454.94 | 348.22 | 356.85 | 359.17 | 374.11 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 0.00 | 17,115.62 | 18,642.88 | 20,366.19 | 0.00 | 12,180.66 | 11,954.73 | 12,284.89 | 0.00 | 16,321.95 | 16,447.68 | 15,800.21 | 0.00 | 1,257.00 | 668.24 | 454.94 | 348.22 | 356.85 | 359.17 | 374.11 |
November 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + — – —
= 0.00
The cash conversion cycle of Lennar Corporation, a key indicator of how efficiently the company manages its cash flow, has shown significant fluctuations over the period from February 2020 to November 2024.
Initially, the cash conversion cycle was around 350-375 days, indicating that it took Lennar around a year to convert its investments in inventory and other resources into cash. By November 2020, the cycle had decreased to about 348 days, suggesting some improvement in efficiency.
However, a sudden spike occurred in February and May 2021, with the cash conversion cycle reaching 454.94 days and 668.24 days, respectively. This drastic increase may raise concerns about the company's working capital management and operational efficiency during this period.
Subsequently, there was a significant and abnormal increase to 1,257 days in August 2021, a level that is highly unusual and may indicate operational challenges or disruptions in the company's cash flow management process. This anomaly continued into the following months, with the cycle reaching extreme levels, peaking at 16,447.68 days in May 2022.
The cycle then experienced a sharp decline in November 2023, suggesting a potential improvement in working capital management. However, there was a subsequent increase in February 2024 to 20,366.19 days, indicating that challenges in cash conversion persisted.
Overall, Lennar Corporation's cash conversion cycle has displayed significant fluctuations throughout the period, indicating varying degrees of efficiency and potential challenges in managing working capital and cash flow. Further analysis of the underlying reasons for these fluctuations would be necessary to identify potential areas for improvement in the company's financial performance.
Peer comparison
Nov 30, 2024