ODP Corp (ODP)
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 | 50.69 | 46.00 | 45.49 | 47.49 | 44.79 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 50.69 | 46.00 | 45.49 | 47.49 | 44.79 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 50.69 + — – —
= 50.69
The cash conversion cycle of ODP Corp has shown a slight increase over the years, rising from 44.79 days as of December 31, 2020, to 50.69 days as of December 31, 2024. This indicates that the company is taking longer to convert its investments in inventory back into cash.
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. A longer cash conversion cycle may indicate inefficiencies in managing inventory, collecting receivables, or managing payables.
Overall, the trend in ODP Corp's cash conversion cycle suggests a need for the company to closely monitor and potentially improve its inventory management, accounts receivable collection, and accounts payable processes to reduce the time it takes to convert its investments into cash, thereby improving its overall liquidity and operational efficiency.
Peer comparison
Dec 31, 2024