Onto Innovation Inc (ONTO)
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 | 302.41 | 254.02 | 246.61 | 251.02 | 376.25 |
| Days of sales outstanding (DSO) | days | 101.36 | 87.66 | — | 97.89 | 147.55 |
| Number of days of payables | days | 46.01 | 42.71 | 54.11 | 52.75 | 59.25 |
| Cash conversion cycle | days | 357.75 | 298.96 | 192.50 | 296.16 | 464.54 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 302.41 + 101.36 – 46.01
= 357.75
The cash conversion cycle of Onto Innovation Inc has fluctuated over the past five years. In 2023, the company's cash conversion cycle was 357.75 days, showing an increase compared to the previous year. This indicates that it took the company longer to convert its resources into cash during the year.
In 2022, the cash conversion cycle was 298.96 days, experiencing a decrease from the prior year. This improvement suggests that Onto Innovation was able to manage its working capital more efficiently and convert its assets into cash at a faster pace.
The company's cash conversion cycle was significantly lower in 2021 at 192.50 days, reflecting a substantial improvement in managing its operating cycle compared to the prior year. This could be attributed to more effective inventory management, accounts receivable collection, and accounts payable management.
In 2020, the cash conversion cycle increased to 296.16 days, indicating a slowdown in the company's ability to generate cash from its operations compared to the previous year.
Lastly, in 2019, Onto Innovation Inc had a cash conversion cycle of 464.54 days, which was the highest among the five years analyzed. This suggests that the company faced challenges in efficiently managing its working capital and converting its assets into cash during that year.
Overall, fluctuations in the cash conversion cycle of Onto Innovation Inc over the past five years indicate varying levels of efficiency in managing working capital, inventory, accounts receivable, and accounts payable. It is essential for the company to focus on strategies to shorten the cash conversion cycle to improve its overall liquidity and operational efficiency.
Peer comparison
Dec 31, 2023