Landstar System Inc (LSTR)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | 51.19 | 47.50 | 64.45 | 67.49 | 52.59 |
| Number of days of payables | days | 376.20 | 475.79 | 585.91 | 457.09 | 349.89 |
| Cash conversion cycle | days | -325.01 | -428.29 | -521.46 | -389.61 | -297.30 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 51.19 – 376.20
= -325.01
The cash conversion cycle of Landstar System Inc has shown a downward trend over the past five years. It decreased from -297.30 days in 2019 to -325.01 days in 2023. A negative cash conversion cycle indicates that the company is efficiently managing its working capital.
The company has been able to reduce the time it takes to convert its resources into cash over the years, signaling improved liquidity and operating efficiency. The negative values mean that Landstar System Inc is able to pay off its current liabilities using funds generated from its operations before those liabilities come due.
This trend suggests that the company is effectively managing its inventory, receivables, and payables. By streamlining its working capital processes, Landstar System Inc has been able to operate more efficiently and potentially free up cash for other purposes.
Overall, the improving trend in the cash conversion cycle reflects positively on Landstar System Inc's operational efficiency and financial health.
Peer comparison
Dec 31, 2023