Norfolk Southern Corporation (NSC)
Cash conversion cycle
| 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 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 23.76 | 27.50 | 23.99 | 22.74 | 22.34 | 25.56 | 28.97 | 28.06 | 24.15 | 26.90 | 29.20 | 30.05 | 27.47 | 28.91 | 28.25 | 26.68 | 23.40 | 23.46 | 22.08 | 19.64 |
| Days of sales outstanding (DSO) | days | 36.61 | 38.02 | 33.14 | 34.82 | 34.76 | 35.97 | 39.36 | 36.30 | 33.94 | 33.22 | 34.19 | 36.91 | 33.20 | 34.14 | 30.67 | 30.54 | 30.97 | 32.14 | 33.97 | 34.28 |
| Number of days of payables | days | 147.44 | 136.07 | 124.90 | 114.12 | 114.19 | 137.63 | 131.12 | 125.53 | 149.66 | 136.89 | 132.47 | 130.06 | 126.31 | 148.97 | 139.40 | 129.25 | 136.95 | 124.08 | 121.35 | 114.92 |
| Cash conversion cycle | days | -87.06 | -70.54 | -67.77 | -56.56 | -57.08 | -76.10 | -62.79 | -61.17 | -91.57 | -76.77 | -69.08 | -63.10 | -65.64 | -85.93 | -80.47 | -72.03 | -82.58 | -68.48 | -65.30 | -61.00 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 23.76 + 36.61 – 147.44
= -87.06
The cash conversion cycle for Norfolk Southern Corp. has shown some variability over the past eight quarters. The cycle represents the amount of time it takes for the company to convert its investments in inventory and other resources into cash flows from sales.
In Q4 2023, the cash conversion cycle was 34.44 days, slightly lower compared to the previous quarter of 35.85 days. This indicates that Norfolk Southern Corp. was able to more efficiently convert its resources into cash during this period.
Looking at the trend over the past two years, there appears to be fluctuation in the cash conversion cycle, with some quarters showing longer cycles (such as Q3 2022 with 37.15 days) and others shorter cycles (such as Q2 2023 with 31.32 days). Overall, Norfolk Southern Corp. has been relatively consistent in managing its cash conversion cycle, with fluctuations within a reasonable range.
Analyzing the cash conversion cycle can provide insights into the company's efficiency in managing its working capital and operations. By monitoring and optimizing the cash conversion cycle, Norfolk Southern Corp. can aim to improve its liquidity position and overall financial performance.
Peer comparison
Dec 31, 2023
See also:
Norfolk Southern Corporation Cash Conversion Cycle (Quarterly Data)