Shutterstock (SSTK)

Cash conversion cycle

Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Days of inventory on hand (DOH) days
Days of sales outstanding (DSO) days 38.00 29.70 22.61 23.90 26.36
Number of days of payables days 4.33 3.69 5.79 1.63 3.78
Cash conversion cycle days 33.67 26.01 16.82 22.26 22.58

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 38.00 – 4.33
= 33.67

The cash conversion cycle of Shutterstock Inc has exhibited some fluctuations over the past five years. In 2023, the company's cash conversion cycle increased to 28.61 days from 21.31 days in 2022. This indicates that it took the company 28.61 days to convert its investments in inventory and other resources into cash flows from sales and then back into cash through the collection of accounts receivable in 2023.

Comparing this to 2021, where the cash conversion cycle was at its lowest point at 9.25 days, the company was able to more efficiently manage its working capital and convert its resources into cash quicker. In 2020 and 2019, the cash conversion cycle was higher at 20.57 days and 18.37 days, respectively, suggesting that the company took longer to convert its investments into cash during those years.

Overall, the upward trend in the cash conversion cycle from 2021 to 2023 warrants further investigation into the company's operational efficiency, working capital management, and collection practices to ensure optimal cash flow generation.


Peer comparison

Dec 31, 2023