Stanley Black & Decker Inc (SWK)
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 | 105.53 | 168.94 | 194.15 | 115.43 | 101.52 |
| Days of sales outstanding (DSO) | days | 35.99 | 28.57 | 37.88 | 47.63 | 44.69 |
| Number of days of payables | days | 51.20 | 67.57 | 122.64 | 101.48 | 93.99 |
| Cash conversion cycle | days | 90.32 | 129.93 | 109.39 | 61.58 | 52.21 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 105.53 + 35.99 – 51.20
= 90.32
The cash conversion cycle of Stanley Black & Decker Inc has fluctuated over the past five years. In 2023, the cash conversion cycle was 90.32 days, indicating that on average, it takes the company about 90 days to convert its investments in inventory and other resources into cash from sales. This is an improvement from 2022 when the cycle was 129.93 days, implying that the company has become more efficient in managing its working capital in 2023.
Comparing to 2021, where the cash conversion cycle was 109.39 days, there was a decrease in the cycle in 2023. However, it is worth noting that the cycle in 2023 is still longer than in 2020 and 2019 when it was 61.58 days and 52.21 days, respectively. This suggests that Stanley Black & Decker Inc may have experienced some challenges in working capital management in recent years.
Overall, the trend in the cash conversion cycle for Stanley Black & Decker Inc shows some volatility over the past five years, with fluctuations in efficiency in converting its resources into cash. Further analysis of the underlying factors contributing to these changes could provide insights into the company's financial management and operational performance.
Peer comparison
Dec 31, 2023