Sherwin-Williams Co (SHW)
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 | 70.16 | 69.65 | 69.93 | 71.68 | 69.17 | 65.08 | 69.31 | 76.62 | 74.76 | 73.17 | 71.81 | 72.01 | 61.69 | 60.93 | 62.48 | 67.66 | 68.03 | 64.01 | 68.61 | 72.69 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 70.16 | 69.65 | 69.93 | 71.68 | 69.17 | 65.08 | 69.31 | 76.62 | 74.76 | 73.17 | 71.81 | 72.01 | 61.69 | 60.93 | 62.48 | 67.66 | 68.03 | 64.01 | 68.61 | 72.69 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 70.16 + — – —
= 70.16
The cash conversion cycle of Sherwin-Williams Co has shown some fluctuations over the years, ranging from a high of 76.62 days in March 2023 to a low of 60.93 days in September 2021. The cash conversion cycle represents the time it takes for the company to convert its investments in inventory and other resources into cash from sales.
A lower cash conversion cycle indicates that the company is able to efficiently manage its cash flow and working capital, as it takes less time to recover the cash invested in the production cycle. On the other hand, a higher cash conversion cycle may suggest inefficiencies in managing inventory, receivables, or payables.
Analyzing the trend, we can see that the cash conversion cycle has generally been within a relatively stable range, indicating consistent management of working capital. However, there have been periods of increase, such as in the last quarter of 2022 and the first quarter of 2023, which may require further investigation to identify the underlying reasons for the prolonged cycle.
Overall, monitoring the cash conversion cycle can provide valuable insights into the efficiency of Sherwin-Williams Co's operations and its ability to manage working capital effectively.
Peer comparison
Dec 31, 2024