Monster Beverage Corp (MNST)

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	78.12	82.07	89.13	100.38	105.97	98.24	96.56	103.56	108.88	102.76	111.65	113.28	89.02	75.46	64.42	67.96	64.85	65.57	72.00	74.13
Days of sales outstanding (DSO)	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Number of days of payables	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Cash conversion cycle	days	78.12	82.07	89.13	100.38	105.97	98.24	96.56	103.56	108.88	102.76	111.65	113.28	89.02	75.46	64.42	67.96	64.85	65.57	72.00	74.13

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 78.12 + — – —
= 78.12

The cash conversion cycle of Monster Beverage Corp has shown fluctuations over the past few years. It is a metric that reflects the average time it takes for the company to convert its resources invested in inventory into cash flows from sales. A shorter cash conversion cycle implies better liquidity and more efficient operations.

From the provided data, we observe that the cash conversion cycle of Monster Beverage Corp ranged from a low of 64.42 days in June 2021 to a high of 113.28 days in March 2022. The cycle has since fluctuated but generally trended downwards towards the end of 2024, reaching 78.12 days in December 2024.

The company's management of inventory, accounts receivable, and accounts payable has a direct impact on the cash conversion cycle. A decrease in the cycle indicates that the company is managing its working capital more effectively, potentially leading to improved cash flows and profitability. Conversely, an increase in the cycle may suggest inefficiencies in managing inventory or delays in collecting receivables.

Further analysis of Monster Beverage Corp's cash conversion cycle trends and comparison with industry benchmarks can provide insights into the company's operational efficiency and financial health. It is essential for investors and stakeholders to monitor this metric closely to assess the company's ability to generate cash and sustain its operations effectively.