NVR Inc (NVR)
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 | 148,006.53 | 19,021.53 | 16,786.83 | 19,569.67 | 17,224.35 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 148,006.53 | 19,021.53 | 16,786.83 | 19,569.67 | 17,224.35 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 148,006.53 + — – —
= 148,006.53
In analyzing the cash conversion cycle of NVR Inc from 2020 to 2024, we observe a varying trend in the efficiency of its working capital management.
Starting from 17,224.35 days in 2020, the cash conversion cycle increased to 19,569.67 days in 2021, indicating a potential slowdown in the conversion of NVR's investments in inventory and accounts receivable into cash. However, in 2022, there was a notable improvement as the cycle decreased to 16,786.83 days, suggesting a more efficient management of working capital.
The trend reversed in 2023 with the cash conversion cycle rising to 19,021.53 days, indicating a potential delay in converting assets into cash. This was followed by a significant spike in 2024 to 148,006.53 days, which appears to be an anomaly or data error given the massive deviation from historical patterns.
Overall, it is essential for NVR Inc to closely monitor and manage its working capital efficiently to ensure a healthy cash conversion cycle, as prolonged cycles can impact liquidity and overall financial health.
Peer comparison
Dec 31, 2024