Sturm Ruger & Company Inc (RGR)
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 | 66.28 | 71.02 | 57.06 | 35.47 | 28.12 |
| Days of sales outstanding (DSO) | days | 45.75 | 40.18 | 40.09 | 28.49 | 37.13 |
| Number of days of payables | days | 11.41 | 9.88 | 11.66 | 9.88 | 12.37 |
| Cash conversion cycle | days | 100.62 | 101.33 | 85.49 | 54.09 | 52.88 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 66.28 + 45.75 – 11.41
= 100.62
The cash conversion cycle of Sturm Ruger & Company Inc has shown a fluctuating trend over the past five years. Starting at 52.88 days on December 31, 2020, the cycle increased to 54.09 days by December 31, 2021. Subsequently, there was a significant rise in the cycle to 85.49 days by December 31, 2022, followed by a further increase to 101.33 days by December 31, 2023. However, by December 31, 2024, the cycle reduced slightly to 100.62 days.
This trend indicates that the company took longer to convert its investments in inventory and accounts receivable into cash over the years, possibly due to changes in inventory turnover or collection periods. A prolonged cash conversion cycle can tie up the company's cash resources, impacting its liquidity and financial flexibility. Therefore, monitoring and managing the cash conversion cycle is crucial for optimizing working capital efficiency and cash flow management.
Peer comparison
Dec 31, 2024