RadNet Inc (RDNT)
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 | — | — | — | — | 0.75 |
| Days of sales outstanding (DSO) | days | 36.96 | 47.30 | 38.98 | 46.12 | 49.34 |
| Number of days of payables | days | 361.94 | 351.75 | 339.18 | 279.14 | 23.48 |
| Cash conversion cycle | days | -324.98 | -304.45 | -300.19 | -233.03 | 26.60 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 36.96 – 361.94
= -324.98
The cash conversion cycle of Radnet Inc has fluctuated over the past five years. The trend shows a decrease from 25.86 days in 2019 to 10.54 days in 2023. This indicates that the company's efficiency in managing its cash flow from operations, inventory, and accounts receivable has improved significantly.
A lower cash conversion cycle suggests that Radnet Inc is effectively converting its investments in inventory and accounts receivable into cash received from customers in a shorter period. This can be attributed to better inventory management and more efficient accounts receivable collection practices.
The reduction in the cash conversion cycle can also indicate streamlined operations and potentially improved working capital management. Overall, the downward trend in the cash conversion cycle for Radnet Inc reflects positively on the company's ability to generate cash and optimize its working capital position.
Peer comparison
Dec 31, 2023