Landstar System Inc (LSTR)
Cash conversion cycle
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | 51.79 | 52.66 | 54.08 | 52.43 | 51.19 | 51.26 | 49.18 | 47.59 | 47.50 | 53.69 | 58.23 | 61.83 | 64.45 | 62.63 | 62.89 | 67.01 | 67.49 | 60.77 | 47.52 | 51.60 |
| Number of days of payables | days | 360.54 | 378.12 | 383.72 | 364.67 | 376.20 | 433.80 | 441.56 | 443.26 | 475.79 | 573.38 | 594.76 | 579.39 | 585.91 | 578.24 | 554.57 | 502.45 | 457.09 | 409.51 | 328.45 | 333.42 |
| Cash conversion cycle | days | -308.74 | -325.46 | -329.64 | -312.24 | -325.01 | -382.54 | -392.39 | -395.67 | -428.29 | -519.69 | -536.53 | -517.56 | -521.46 | -515.60 | -491.67 | -435.44 | -389.61 | -348.74 | -280.94 | -281.82 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 51.79 – 360.54
= -308.74
The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales. A negative cash conversion cycle indicates that a company can generate revenue and collect cash from customers before having to pay its suppliers and vendors.
For Landstar System Inc, the cash conversion cycle has consistently remained negative over the period from March 31, 2020, to December 31, 2024. This indicates that the company efficiently manages its working capital, turning its investments into cash quickly. It shows that Landstar System Inc has a strong position in its industry in terms of managing inventories, sales, and collections, which allows for operating with a shorter cash cycle than the average for its sector.
The trend of the cash conversion cycle for Landstar System Inc reflects a slight increase initially, reaching a peak around September 30, 2021, but then decreasing gradually. The relatively steady decline in the cash conversion cycle from September 2021 to December 2024 suggests that the company has been improving its efficiency in managing its working capital during this period.
Overall, Landstar System Inc's consistently negative cash conversion cycle signifies that the company is efficiently managing its cash flows, inventories, and collections, which can contribute to the company's financial stability and flexibility.
Peer comparison
Dec 31, 2024