Sturm Ruger & Company Inc (RGR)
Cash conversion cycle
| Dec 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 66.28 | 68.19 | 66.33 | 61.49 | 71.02 | 68.65 | 59.50 | 54.07 | 57.06 | 54.66 | 49.24 | 38.24 | 35.47 | 31.61 | 26.98 | 26.13 | 28.12 | 14.05 | 13.21 | 21.05 |
| Days of sales outstanding (DSO) | days | 45.75 | 42.19 | 39.46 | 45.23 | 40.18 | 38.88 | 33.34 | — | 40.09 | — | — | — | 28.49 | — | — | — | — | — | — | — |
| Number of days of payables | days | 11.41 | — | — | — | 9.88 | — | — | — | 11.66 | — | — | — | 9.88 | — | — | — | 12.37 | — | — | — |
| Cash conversion cycle | days | 100.62 | 110.38 | 105.79 | 106.72 | 101.33 | 107.53 | 92.85 | 54.07 | 85.49 | 54.66 | 49.24 | 38.24 | 54.09 | 31.61 | 26.98 | 26.13 | 15.74 | 14.05 | 13.21 | 21.05 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 66.28 + 45.75 – 11.41
= 100.62
Sturm Ruger & Company Inc's cash conversion cycle, a measure of how efficiently the company manages its working capital, has shown some fluctuations in the recent periods. The cash conversion cycle represents the time it takes for the company to convert its investments in inventory into cash received from sales.
Analyzing the data provided, we observe that the cash conversion cycle fluctuated throughout the periods, ranging from a low of 13.21 days in June 2020 to a high of 110.38 days in September 2024. A lower cash conversion cycle indicates that the company is managing its working capital efficiently, while a higher cycle suggests potential issues with inventory management, accounts receivable collection, or accounts payable.
It is notable that the cash conversion cycle increased significantly towards the latter periods, reaching over 100 days, which may indicate challenges in converting sales into cash quickly. This can put pressure on the company's liquidity and cash flow management.
Overall, monitoring the cash conversion cycle is crucial for Sturm Ruger & Company Inc to optimize its working capital management, streamline its operations, and ensure a healthy financial position in the long term. By addressing any inefficiencies in the cash conversion cycle, the company can enhance its cash flow and overall financial performance.
Peer comparison
Dec 31, 2024