Seagate Technology PLC (STX)

Cash conversion cycle

Jun 30, 2024 Jun 30, 2023 Jun 30, 2022 Jun 30, 2021 Jun 30, 2020
Days of inventory on hand (DOH) days 83.06 62.71 65.10 52.93 50.88
Days of sales outstanding (DSO) days 31.78 38.95 47.95 39.57 38.73
Number of days of payables days 119.72 88.18 85.61 75.83 80.55
Cash conversion cycle days -4.88 13.48 27.44 16.67 9.06

June 30, 2024 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 83.06 + 31.78 – 119.72
= -4.88

The cash conversion cycle of Seagate Technology PLC has fluctuated over the past five years. In the most recent period ending June 30, 2024, the company achieved a negative cash conversion cycle of -4.88 days, indicating that it was able to convert its investments in inventory into cash quickly, possibly resulting in efficient working capital management.

In the preceding years, we observe a mixed trend in the cash conversion cycle:

1. In June 30, 2023, Seagate had a cash conversion cycle of 13.48 days, showing an increase from the prior year. This might suggest a more extended period required to convert inventory into cash compared to the previous year.

2. The cycle further increased to 27.44 days in June 30, 2022, signifying a significant extension in the time taken to convert inventory to cash. This could indicate challenges in managing working capital efficiently during this period.

3. However, in June 30, 2021, the cash conversion cycle improved to 16.67 days, showing some progress in converting inventory into cash more quickly compared to the previous year.

4. In June 30, 2020, Seagate achieved a cash conversion cycle of 9.06 days, showcasing efficient working capital management and a relatively quick conversion of investments in inventory into cash during that period.

Overall, the negative cash conversion cycle in 2024 implies that Seagate had improved its operational efficiency in managing working capital. However, the company experienced fluctuations in its cash conversion cycle in the previous years, indicating potential challenges in efficiently managing inventory and accounts receivable to convert them into cash within a reasonable timeframe.


Peer comparison

Jun 30, 2024

Company name
Symbol
Cash conversion cycle
Seagate Technology PLC
STX
-4.88
NetApp Inc
NTAP
31.02
Pure Storage Inc
PSTG
78.97
Western Digital Corporation
WDC
166.11