RXO Inc. (RXO)
Cash conversion cycle
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | ||
|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | |||
| Days of sales outstanding (DSO) | days | 69.08 | 70.58 | 64.10 | |||
| Number of days of payables | days | 42.15 | 44.19 | 41.22 | |||
| Cash conversion cycle | days | 26.93 | 26.38 | 22.87 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 69.08 – 42.15
= 26.93
The cash conversion cycle of RXO Inc. has been fluctuating over the past few quarters. In the latest quarter, as of December 31, 2023, the cash conversion cycle increased to 26.93 days, from 26.38 days in September 30, 2023. This indicates that it takes RXO Inc. approximately 26.93 days to convert its investments in inventory and accounts receivable into cash.
Comparing with the previous quarters, the cash conversion cycle was at its lowest at 22.87 days on June 30, 2023, showing that the company was able to manage its working capital more efficiently during that period. Overall, the cash conversion cycle can provide insights into RXO Inc.'s operational efficiency and effectiveness in managing its cash flow, inventory, and accounts receivable. It's essential for the company to monitor and optimize its cash conversion cycle to ensure healthy liquidity and financial performance.
Peer comparison
Dec 31, 2023