NV5 Global Inc (NVEE)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | 43.64 | 47.19 | 55.58 | 55.34 | 94.40 |
| Number of days of payables | days | 25.82 | 30.24 | 32.91 | 24.50 | 27.04 |
| Cash conversion cycle | days | 17.82 | 16.95 | 22.67 | 30.84 | 67.36 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 43.64 – 25.82
= 17.82
The cash conversion cycle measures how long it takes a company to convert its investments in inventory and other resources into cash inflows from sales. NV5 Global Inc's cash conversion cycle has shown fluctuations over the past five years.
In 2019, the company had a significantly long cash conversion cycle of 67.36 days, indicating that it took a relatively long time for the company to convert its investments into cash inflows. However, this cycle has improved significantly over the years, with the trend showing a steady decline.
By 2023, the cash conversion cycle had decreased to 17.82 days, reflecting a more efficient management of working capital and faster conversion of inventory and other resources into cash. This shorter cash conversion cycle suggests that NV5 Global Inc has been able to improve its cash flow management and operate more efficiently in terms of working capital.
Overall, the decreasing trend in NV5 Global Inc's cash conversion cycle indicates improvements in its operational efficiency and working capital management over the years, leading to faster cash inflows and potentially better overall financial performance.
Peer comparison
Dec 31, 2023