Lamb Weston Holdings Inc (LW)
Cash conversion cycle
| May 31, 2024 | May 26, 2024 | May 31, 2023 | May 28, 2023 | May 31, 2022 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 88.41 | 76.91 | 86.81 | 75.99 | 64.18 |
| Days of sales outstanding (DSO) | days | — | 42.00 | — | 49.21 | — |
| Number of days of payables | days | — | 56.32 | — | 51.91 | — |
| Cash conversion cycle | days | 88.41 | 62.59 | 86.81 | 73.30 | 64.18 |
May 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 88.41 + — – —
= 88.41
The cash conversion cycle of Lamb Weston Holdings Inc has shown some fluctuations over the years. On May 31, 2022, the cash conversion cycle was at 64.18 days, indicating the number of days it takes for the company to convert its investments in inventory and other resources into cash inflows from sales. By May 28, 2023, the cycle increased to 73.30 days, suggesting a slightly longer period for the company to collect cash from its operations.
However, on May 31, 2023, the cash conversion cycle significantly increased to 86.81 days, reflecting a potential delay in the conversion of investments into cash inflows. This peak was followed by a notable improvement as of May 26, 2024, where the cycle decreased to 62.59 days, indicating a more efficient management of working capital.
Nonetheless, by May 31, 2024, the cash conversion cycle increased sharply to 88.41 days, reaching a level even higher than the previous peak. This suggests a potential challenge in managing the company's operating cycle efficiently. Overall, Lamb Weston Holdings Inc should continue monitoring and optimizing its cash conversion cycle to improve liquidity and operational efficiency.
Peer comparison
May 31, 2024