Quanex Building Products (NX)
Cash conversion cycle
| Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | Jan 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 84.64 | 37.79 | 38.21 | 40.22 | 35.83 | 43.82 | 45.83 | 49.01 | 46.30 | 53.69 | 52.40 | 49.42 | 40.62 | 42.98 | 39.83 | 40.97 | 33.90 | 35.75 | 40.80 | 41.13 |
| Days of sales outstanding (DSO) | days | 111.47 | 29.43 | 28.82 | 26.35 | 63.00 | 30.90 | 29.52 | 25.45 | 57.33 | 33.14 | 37.14 | 32.70 | 73.55 | 34.63 | 36.39 | 34.04 | 75.68 | 36.86 | 28.29 | 26.16 |
| Number of days of payables | days | 38.21 | 24.38 | 22.83 | 20.62 | 27.20 | 29.72 | 25.92 | 24.21 | 29.84 | 32.83 | 35.75 | 31.77 | 38.08 | 36.40 | 41.18 | 33.69 | 42.85 | 32.81 | 22.95 | 25.85 |
| Cash conversion cycle | days | 157.90 | 42.85 | 44.20 | 45.95 | 71.63 | 45.00 | 49.43 | 50.25 | 73.80 | 54.00 | 53.79 | 50.35 | 76.08 | 41.22 | 35.05 | 41.32 | 66.73 | 39.80 | 46.14 | 41.44 |
October 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 84.64 + 111.47 – 38.21
= 157.90
Based on the data provided, Quanex Building Products' cash conversion cycle has exhibited fluctuations over the past several quarters. The cash conversion cycle represents the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
In the most recent quarter ending October 31, 2024, Quanex Building Products had a cash conversion cycle of 157.90 days, indicating that the company takes approximately 157.90 days to convert its investments in inventory and other resources into cash received from sales. This is significantly higher compared to the previous quarter's figure of 42.85 days, suggesting a substantial increase in the time it takes for Quanex Building Products to convert its resources into cash.
Looking at the trend over the past few quarters, there have been fluctuations in the cash conversion cycle, with periods of both shorter and longer cycles. Generally, a shorter cash conversion cycle is preferred as it indicates that the company is efficient in managing its working capital and turning its investments into cash quickly.
It is important for Quanex Building Products to monitor and effectively manage its cash conversion cycle to ensure optimal working capital management and cash flow efficiency. By analyzing the reasons behind the fluctuations in the cycle and implementing strategies to improve working capital management, the company can enhance its overall financial performance and liquidity position.
Peer comparison
Oct 31, 2024