Public Service Enterprise Group Inc (PEG)

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	70.92	59.13	40.42	22.37	71.66
Days of sales outstanding (DSO)	days	81.73	56.39	87.34	78.28	64.69
Number of days of payables	days	90.32	94.58	95.14	65.65	158.83
Cash conversion cycle	days	62.33	20.94	32.62	34.99	-22.47

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 70.92 + 81.73 – 90.32
= 62.33

The cash conversion cycle of Public Service Enterprise Group Inc has shown some fluctuations in recent years. As of December 31, 2020, the cash conversion cycle was -22.47 days, indicating that the company was able to convert its inventory and accounts receivable into cash quicker than it paid its suppliers during that period.

However, by December 31, 2021, the cash conversion cycle increased to 34.99 days, suggesting that the company took longer to convert its resources into cash. This could be a sign of increasing inventory levels or slower collection of accounts receivable.

In the following years, the cash conversion cycle improved slightly, with values of 32.62 days as of December 31, 2022, and 20.94 days by December 31, 2023. These changes could signify better management of working capital or more efficient cash flow conversion processes.

Finally, as of December 31, 2024, the cash conversion cycle increased significantly to 62.33 days. This substantial increase might indicate challenges in managing working capital efficiently, potentially due to changes in market conditions or operational disruptions.

In summary, the cash conversion cycle of Public Service Enterprise Group Inc has displayed fluctuations over the years, reflecting changes in operating efficiency and working capital management practices. Monitoring this metric could provide insights into the company's liquidity and operational effectiveness.