Nordson Corporation (NDSN)
Cash conversion cycle
| Oct 31, 2024 | Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 82.93 | 82.10 | 71.94 | 66.18 | 55.09 |
| Days of sales outstanding (DSO) | days | 80.73 | 83.98 | 76.36 | 76.46 | 82.47 |
| Number of days of payables | days | 17.01 | 19.19 | 18.63 | 18.55 | 14.11 |
| Cash conversion cycle | days | 146.66 | 146.89 | 129.67 | 124.10 | 123.45 |
October 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 82.93 + 80.73 – 17.01
= 146.66
The cash conversion cycle for Nordson Corporation has shown a fluctuating trend over the past five years. In the most recent year ending on October 31, 2024, the company's cash conversion cycle was 146.66 days, slightly lower compared to the prior year's 146.89 days. This indicates that Nordson took slightly less time to convert its investments in inventory and receivables back into cash during the most recent year.
Looking back further, there was a notable increase in the cash conversion cycle in the year ending October 31, 2022, where it reached 129.67 days, up from 124.10 days in the previous year. However, in the year ending October 31, 2021, there was a slight improvement with the cycle decreasing to 124.10 days from 123.45 days in the year ending October 31, 2020.
Overall, the trend in Nordson Corporation's cash conversion cycle indicates some variability in the efficiency of its working capital management over the past five years. The company may benefit from analyzing the factors contributing to these fluctuations to further optimize its cash conversion cycle and enhance its liquidity position.
Peer comparison
Oct 31, 2024