Sanmina Corporation (SANM)
Cash conversion cycle
| 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 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 73.24 | 69.89 | 66.71 | 63.40 | 63.79 | 63.50 | 67.51 | 100.71 | 107.51 | 111.92 | 109.90 | 72.14 | 60.53 | 50.25 | 44.17 | 47.15 | 48.86 | 49.91 | 47.31 | 42.14 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | 73.16 | 72.39 | 69.57 | 64.79 | 67.33 | 73.51 | 79.52 | 124.69 | 130.32 | 139.12 | 138.91 | 97.51 | 85.11 | 72.95 | 62.36 | 65.78 | 68.64 | 70.72 | 60.33 | 58.94 |
| Cash conversion cycle | days | 0.08 | -2.50 | -2.86 | -1.39 | -3.54 | -10.01 | -12.01 | -23.98 | -22.81 | -27.20 | -29.01 | -25.37 | -24.57 | -22.71 | -18.20 | -18.64 | -19.78 | -20.81 | -13.02 | -16.80 |
September 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 73.24 + — – 73.16
= 0.08
The cash conversion cycle measures how efficiently a company manages its working capital by assessing the time it takes to convert its investments in inventory and accounts receivable into cash. A negative cash conversion cycle indicates that the company is able to generate cash from its operations before paying its suppliers, which is generally considered a favorable position.
Over the past several quarters, Sanmina Corporation has shown a pattern of negative cash conversion cycles, indicating strong working capital management. Specifically, for the most recent quarter ending September 30, 2024, the company's cash conversion cycle was 0.08 days, suggesting that Sanmina is efficient in converting its inventory and accounts receivable into cash.
Looking back at historical data, there has been a trend of improving cash conversion cycles for Sanmina Corporation, with the cycle becoming more negative over time. This suggests that the company has been able to optimize its working capital management practices, resulting in quicker access to cash from its operating activities.
Overall, the consistently negative cash conversion cycles for Sanmina Corporation indicate solid financial health in terms of managing its working capital efficiently and effectively converting investments into cash. This trend reflects positively on the company's operational performance and ability to generate cash flows.
Peer comparison
Sep 30, 2024