Maximus Inc (MMS)
Cash conversion cycle
| 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 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | 60.50 | 59.12 | 65.25 | 63.03 | 61.53 | 69.54 | 56.94 | 78.26 | 63.61 | 69.48 | 69.11 | 69.52 | 71.62 | 101.28 | 74.41 | 79.61 | 82.90 | 91.97 | 61.95 | 61.43 |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 60.50 | 59.12 | 65.25 | 63.03 | 61.53 | 69.54 | 56.94 | 78.26 | 63.61 | 69.48 | 69.11 | 69.52 | 71.62 | 101.28 | 74.41 | 79.61 | 82.90 | 91.97 | 61.95 | 61.43 |
September 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 60.50 – —
= 60.50
The cash conversion cycle of Maximus Inc has fluctuated over the past few quarters, indicating variability in the firm's ability to convert its resources effectively into cash. The cycle represents the time taken by the company to convert its investments in inventory back into cash.
Looking at the data, we can see that the cash conversion cycle ranged from a low of 56.94 days to a high of 101.28 days over the past eight quarters. The highest cycle of 101.28 days, recorded in the first quarter of 2021, suggests that Maximus took a relatively longer time to generate cash from its operating cycle during that period.
However, the company managed to improve its cash conversion efficiency in the subsequent periods, with the cycle ranging between 56.94 days and 78.26 days. The lower end of the range, observed in the first quarter of 2023, indicates a more efficient use of resources to generate cash.
Overall, Maximus Inc should aim to maintain a shorter cash conversion cycle to optimize its working capital management and enhance liquidity. By effectively managing its inventory, accounts receivable, and accounts payable, the company can shorten its cash conversion cycle, leading to improved financial performance and stability.
Peer comparison
Sep 30, 2024