Science Applications International Corporation Common Stock (SAIC)

Cash conversion cycle

		Feb 2, 2024	Feb 3, 2023	Jan 28, 2022	Jan 29, 2021	Jan 31, 2020
Days of inventory on hand (DOH)	days	0.17	3.80	3.57	4.55	5.40
Days of sales outstanding (DSO)	days	44.08	45.04	50.68	50.41	63.75
Number of days of payables	days	31.49	33.42	34.18	30.13	33.91
Cash conversion cycle	days	12.75	15.43	20.07	24.83	35.25

February 2, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 0.17 + 44.08 – 31.49
= 12.75

The cash conversion cycle of Science Applications International Corporation Common Stock has shown a consistent decreasing trend over the past five years, indicating improved efficiency in managing its working capital. The cycle decreased from 35.25 days in January 2020 to 12.75 days in February 2024.

This suggests that the company has been able to reduce the time it takes to convert its investments in raw materials and production into cash receipts from sales. A shorter cash conversion cycle implies faster turnover of inventory and receivables, allowing the company to free up cash for reinvestment or other uses more quickly.

Overall, the decreasing trend in Science Applications International Corporation's cash conversion cycle reflects positive working capital management and operational efficiency, which can potentially contribute to improved financial performance and liquidity position.