Mercury Systems Inc (MRCY)
Cash conversion cycle
| 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 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 191.41 | 192.65 | 197.25 | 207.58 | 187.30 | 195.05 | 183.19 | 173.18 | 166.33 | 165.91 | 161.17 | 153.35 | 150.14 | 161.87 | 167.84 | 164.07 | 147.81 | 141.97 | 139.42 | 140.78 |
| Days of sales outstanding (DSO) | days | 48.70 | 39.89 | 33.74 | 36.00 | 46.75 | 45.36 | 53.24 | 60.50 | 53.37 | — | 48.38 | — | 50.88 | — | — | — | — | — | — | — |
| Number of days of payables | days | 46.28 | 44.88 | 49.04 | 54.81 | 57.76 | 63.30 | 51.22 | 64.22 | 60.71 | 57.73 | 38.09 | 48.01 | 32.48 | 40.42 | 37.02 | 50.21 | 34.76 | 43.93 | 32.66 | 33.12 |
| Cash conversion cycle | days | 193.83 | 187.66 | 181.95 | 188.76 | 176.29 | 177.10 | 185.22 | 169.45 | 158.99 | 108.18 | 171.45 | 105.34 | 168.54 | 121.45 | 130.82 | 113.86 | 113.06 | 98.04 | 106.77 | 107.66 |
June 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 191.41 + 48.70 – 46.28
= 193.83
The cash conversion cycle of Mercury Systems Inc has shown fluctuations over the reporting periods analyzed. The cycle represents the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales. A longer cash conversion cycle may indicate inefficiencies in managing inventory, collecting receivables, or paying suppliers.
Looking at the data, the cash conversion cycle ranged from 98.04 days to 193.83 days over the past few quarters. In general, the company's cash conversion cycle appears to have been relatively long, with some periods showing significant improvements while others indicating delays in converting resources into cash.
It is important for management to focus on optimizing inventory management, accounts receivable collection, and accounts payable to reduce the cash conversion cycle. By efficiently managing these components, the company can potentially free up cash flow, improve working capital management, and enhance overall financial performance. Future monitoring and analysis of the cash conversion cycle will be crucial for evaluating the company's operational efficiency and financial health.
Peer comparison
Jun 30, 2024