PACCAR Inc (PCAR)
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 | 31.05 | 959.69 | 957.71 | 762.01 | 401.65 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 31.05 | 959.69 | 957.71 | 762.01 | 401.65 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 31.05 + — – —
= 31.05
The cash conversion cycle for PACCAR Inc has exhibited significant fluctuations over the years based on the provided data. As of December 31, 2020, the company had a cash conversion cycle of 401.65 days, indicating the time it takes to convert investments in inventory and other resources into cash flow from sales.
By December 31, 2021, the cash conversion cycle extended to 762.01 days, reflecting a notable increase in the time it takes for PACCAR Inc to convert its investments into cash. The trend continued in 2022 and 2023, with the cash conversion cycle further increasing to 957.71 days and 959.69 days, respectively.
In a drastic turnaround, by December 31, 2024, PACCAR Inc managed to reduce its cash conversion cycle significantly to 31.05 days, indicating a substantial improvement in its operational efficiency and management of working capital.
Overall, the fluctuation in PACCAR Inc's cash conversion cycle highlights the company's ability to effectively manage its cash flows, working capital, and operational efficiency over the years, with a notable improvement observed in 2024.
Peer comparison
Dec 31, 2024