Parsons Corp (PSN)
Cash conversion cycle
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | — | — | — | — | — | — | 0.08 | — | 0.13 | — | — | — | 0.44 | — | — | — | 1.53 |
| Days of sales outstanding (DSO) | days | 84.84 | 86.80 | 90.29 | 80.06 | 89.28 | 96.34 | 85.30 | 81.78 | 85.06 | 91.82 | 83.65 | 76.74 | 81.49 | 81.00 | 83.53 | 83.18 | 94.36 | 87.01 | 89.21 | 82.65 |
| Number of days of payables | days | 17.84 | 15.92 | 18.07 | 16.96 | 19.78 | 18.67 | 17.61 | 17.73 | 18.27 | 18.33 | 15.22 | 19.31 | 24.64 | 24.82 | 27.74 | 27.65 | 25.39 | 25.39 | 27.81 | 26.11 |
| Cash conversion cycle | days | 66.99 | 70.87 | 72.23 | 63.10 | 69.50 | 77.67 | 67.69 | 64.05 | 66.79 | 73.57 | 68.44 | 57.55 | 56.86 | 56.18 | 55.80 | 55.97 | 68.97 | 61.62 | 61.41 | 58.07 |
September 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 84.84 – 17.84
= 66.99
The cash conversion cycle of Parsons Corp has shown fluctuations over the past few quarters. It measures the time it takes for the company to convert its investments in raw materials into cash flows from sales.
From December 2019 to September 2020, the company's cash conversion cycle decreased from 58.07 days to 55.97 days, indicating an improvement in efficiency. However, in the subsequent quarters up to June 2021, the cycle increased, reaching a peak of 77.67 days, reflecting a potential slowdown in the company's operational efficiency.
From September 2021 to March 2022, there was a significant improvement in the cash conversion cycle, decreasing to a low of 56.18 days. This suggests that Parsons Corp was able to manage its inventories, receivables, and payables more effectively during this period.
In the most recent data up to September 2024, the cash conversion cycle increased to 66.99 days, indicating a lengthening of the time it takes for the company to generate cash from its operations compared to the previous quarters.
Overall, the trend in the cash conversion cycle for Parsons Corp shows some variability, with periods of improvement followed by increases in the cycle duration. Further analysis would be needed to understand the factors driving these fluctuations and to assess the company's overall operational efficiency and working capital management.
Peer comparison
Sep 30, 2024