National HealthCare Corporation (NHC)

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 3.75 3.45 3.03 3.12 3.48 3.59 3.44 3.42 3.48 3.52 3.62 4.33 4.48 4.68 4.28 4.34 4.69 3.86 3.88 4.35
Days of sales outstanding (DSO) days 37.92 38.11 33.85 39.38 34.87 33.89 33.98 34.97 33.71 32.71 33.00 33.69 32.81 34.71 35.16 36.78 32.16 30.65 31.26 37.14
Number of days of payables days 16.96 18.26 18.29 18.75 17.67 15.59 14.86 14.59 16.49 16.85 21.72 21.75 20.94 26.86 21.13 16.93 20.07 19.07 19.55 18.63
Cash conversion cycle days 24.72 23.30 18.59 23.75 20.67 21.88 22.57 23.80 20.71 19.38 14.91 16.27 16.36 12.53 18.31 24.19 16.78 15.44 15.59 22.86

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 3.75 + 37.92 – 16.96
= 24.72

The cash conversion cycle of National HealthCare Corporation has exhibited fluctuations over the periods analyzed. The company's cash conversion cycle, which represents the time it takes for a company to convert its investments in inventory into cash flows from sales, ranged between 12.53 days on September 30, 2021, and 24.72 days on December 31, 2024.

The trend of the cash conversion cycle indicates that the company has been able to manage its working capital efficiently during some periods but faced challenges in others. A lower cash conversion cycle implies that the company is able to generate cash quickly and efficiently, whereas a higher cycle suggests a longer time to convert investments into cash.

Therefore, National HealthCare Corporation should focus on optimizing its inventory turnover, accounts receivable collection, and accounts payable management to further enhance its cash conversion cycle efficiency and overall liquidity position. Monitoring and managing the cash conversion cycle effectively can help the company improve its cash flow management and financial performance in the long run.


Peer comparison

Dec 31, 2024

Company name
Symbol
Cash conversion cycle
National HealthCare Corporation
NHC
24.72
The Ensign Group Inc
ENSG
38.83