Par Pacific Holdings Inc (PARR)

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	60.70	58.80	65.32	50.57	46.10
Days of sales outstanding (DSO)	days	16.40	12.71	15.34	13.34	15.67
Number of days of payables	days	20.47	8.54	12.77	12.58	12.16
Cash conversion cycle	days	56.63	62.96	67.89	51.33	49.62

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 60.70 + 16.40 – 20.47
= 56.63

The cash conversion cycle of Par Pacific Holdings Inc has shown fluctuations over the past five years. The company's cash conversion cycle decreased from 49.91 days in 2019 to 53.03 days in 2020, indicating a slight increase in the time it takes for the company to convert its investments in inventory and other resources into cash.

However, in 2021, the cash conversion cycle increased significantly to 68.61 days, which suggests that the company took longer to convert its resources into cash during that period. This may imply inefficiencies in managing inventory, collecting receivables, or managing payables.

In the subsequent years, the cash conversion cycle improved slightly, with values of 63.59 days in 2022 and 57.33 days in 2023. While these improvements are positive, they indicate that the company is still taking more than two months on average to convert its investments into cash.

Overall, Par Pacific Holdings Inc's cash conversion cycle has shown fluctuations, with a general trend of improvement in recent years. However, the company may benefit from further optimizing its working capital management to reduce the time it takes to convert its resources into cash.