Nextera Energy Inc (NEE)
Cash conversion cycle
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 81.74 | 75.82 | 65.26 | 67.19 | 77.71 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 81.74 | 75.82 | 65.26 | 67.19 | 77.71 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 81.74 + — – —
= 81.74
Nextera Energy Inc's cash conversion cycle has shown fluctuations over the years. As of the latest data available, as of December 31, 2024, the cash conversion cycle stands at 81.74 days. This indicates that it takes Nextera Energy Inc approximately 81.74 days to convert its investments in inventory and receivables into cash flows from sales.
Over the period from 2020 to 2024, the company has seen some improvements in its cash conversion efficiency, with the cycle decreasing from 77.71 days in 2020 to 81.74 days in 2024. However, it is important to note that in 2021 and 2022, the cash conversion cycle reached its lowest levels of 67.19 days and 65.26 days, respectively, indicating that the company was able to manage its working capital more effectively during those years.
The increase in the cash conversion cycle in 2024 compared to the previous years could suggest a lengthening of the time it takes for the company to generate cash from its operational activities. This could be a result of changes in management of inventory, payment terms with suppliers, or collection periods for receivables.
Overall, monitoring the cash conversion cycle is crucial for Nextera Energy Inc to ensure efficient management of its working capital and liquidity. Further analysis and comparison with industry benchmarks can provide more insights into the company's efficiency in converting investments into cash flows.
Peer comparison
Dec 31, 2024