TE Connectivity Ltd (TEL)
Cash conversion cycle
| 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 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 78.85 | 71.13 | 76.45 | 76.62 | 81.39 | 75.42 | 88.85 | 89.69 | 86.28 | 76.70 | 74.46 | 70.62 | 65.41 | 63.73 | 73.22 | 63.27 | 67.63 | 61.04 | 67.70 | 65.96 |
| Days of sales outstanding (DSO) | days | 64.73 | 67.88 | 67.22 | 67.92 | 65.45 | 64.49 | 72.92 | 72.57 | 68.45 | 71.89 | 76.06 | 81.84 | 77.17 | 71.49 | 64.34 | 69.01 | 64.51 | 63.23 | 66.09 | 64.37 |
| Number of days of payables | days | 47.88 | 43.56 | 44.11 | 45.74 | 48.69 | 44.90 | 56.25 | 59.40 | 59.56 | 58.37 | 60.33 | 59.33 | 51.58 | 41.70 | 41.79 | 43.95 | 48.38 | 45.11 | 49.64 | 49.72 |
| Cash conversion cycle | days | 95.70 | 95.44 | 99.56 | 98.80 | 98.15 | 95.02 | 105.52 | 102.87 | 95.17 | 90.21 | 90.20 | 93.12 | 91.00 | 93.52 | 95.77 | 88.33 | 83.75 | 79.15 | 84.15 | 80.61 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 78.85 + 64.73 – 47.88
= 95.70
The cash conversion cycle of TE Connectivity Ltd has shown some fluctuations over the past few quarters. The company's cash conversion cycle measures the time it takes for TE Connectivity to convert its investments in inventory and accounts receivable into cash flows from sales.
From the data provided, we can see that the cash conversion cycle has ranged from a low of 79.15 days to a high of 105.52 days over the last five quarters. Generally, a shorter cash conversion cycle indicates that the company is efficient in managing its working capital and converting its assets into cash quickly.
In the most recent quarter, the cash conversion cycle was 95.70 days, showing a slight increase compared to the previous quarter. This increase may indicate that TE Connectivity is taking longer to convert its inventory and accounts receivable into cash flows, potentially signaling inefficiencies in its working capital management.
It is important for TE Connectivity to monitor its cash conversion cycle closely and implement strategies to improve efficiency in managing its working capital to ensure optimal cash flow and liquidity.
Peer comparison
Dec 31, 2023