Roper Technologies, Inc. (ROP)

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	20.40	23.14	25.09	17.71	50.47
Days of sales outstanding (DSO)	days	52.50	55.32	55.45	70.58	100.24
Number of days of payables	days	—	—	—	—	54.35
Cash conversion cycle	days	72.90	78.46	80.54	88.29	96.36

December 31, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 20.40 + 52.50 – —
= 72.90

The cash conversion cycle of Roper Technologies, Inc. has shown a consistent downward trend over the past five years. At the end of December 31, 2020, the cash conversion cycle was 96.36 days, indicating that it took the company an average of 96.36 days to convert its investments in inventory and accounts receivable into cash.

Over the years, Roper has managed to improve its efficiency in managing its working capital, as evidenced by the decreasing trend in the cash conversion cycle. By December 31, 2024, the cash conversion cycle had decreased to 72.90 days, reflecting the company's ability to efficiently manage its cash flow and working capital.

The decreasing trend in the cash conversion cycle suggests that Roper Technologies, Inc. has been able to streamline its operations, reduce its inventory holding period, and collect receivables more promptly. This improvement in efficiency can help the company free up cash for other investments or operational needs, ultimately enhancing its financial health and performance.