Option Care Health Inc (OPCH)
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 | 35.55 | 30.11 | 26.60 | 25.13 | 24.63 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 35.55 | 30.11 | 26.60 | 25.13 | 24.63 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 35.55 + — – —
= 35.55
Option Care Health Inc's cash conversion cycle has been increasing steadily over the five-year period from 24.63 days as of December 31, 2020, to 35.55 days as of December 31, 2024. This trend indicates that the company is taking longer to convert its investments in inventory and accounts receivable into cash.
The cash conversion cycle is a measure of a company's efficiency in managing its working capital. A longer cash conversion cycle may suggest inefficiencies in inventory management, accounts receivable collection, or payment of accounts payable. Option Care Health Inc should investigate the underlying reasons for this increasing trend and take steps to improve its working capital management to enhance cash flow and overall financial health.
Peer comparison
Dec 31, 2024