Proto Labs Inc (PRLB)
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 | 16.17 | 17.68 | 18.16 | 18.10 | 18.31 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 16.17 | 17.68 | 18.16 | 18.10 | 18.31 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 16.17 + — – —
= 16.17
Proto Labs Inc has shown a consistent improvement in its cash conversion cycle over the years, reflecting efficiency in managing its working capital. The company's cash conversion cycle decreased from 18.31 days in December 2020 to 16.17 days in December 2024. This indicates that Proto Labs has been able to reduce the time it takes to convert its investments in inventory and receivables into cash.
A lower cash conversion cycle suggests that the company is able to generate cash quickly from its operating activities, which is a positive sign of liquidity and operational efficiency. Proto Labs' ability to efficiently manage its working capital is essential in sustaining its day-to-day operations and supporting future growth initiatives. The decreasing trend in the cash conversion cycle demonstrates the company's effective management of inventory, accounts receivable, and accounts payable. Overall, Proto Labs Inc's improving cash conversion cycle reflects strong financial health and effective working capital management.
Peer comparison
Dec 31, 2024