Thor Industries Inc (THO)
Cash conversion cycle
| Jul 31, 2024 | Jul 31, 2023 | Jul 31, 2022 | Jul 31, 2021 | Jul 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 51.85 | 57.26 | 43.33 | 43.80 | 33.56 |
| Days of sales outstanding (DSO) | days | 18.24 | 18.00 | 19.09 | 23.79 | 26.64 |
| Number of days of payables | days | 23.83 | 25.50 | 20.31 | 29.27 | 29.82 |
| Cash conversion cycle | days | 46.26 | 49.76 | 42.11 | 38.32 | 30.38 |
July 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 51.85 + 18.24 – 23.83
= 46.26
The cash conversion cycle of Thor Industries Inc has shown a fluctuating trend over the past five years. In the most recent fiscal year ending July 31, 2024, the cash conversion cycle decreased to 46.26 days compared to 49.76 days in the previous year. This indicates that the company took slightly less time to convert its investments in inventory and accounts receivable into cash during the latest fiscal period.
Looking back over the last five years, there has been a general increasing trend in the cash conversion cycle, with fluctuations seen from year to year. The cycle was shortest in the fiscal year ending July 31, 2020, at 30.38 days, and has since increased, reaching a peak of 49.76 days in July 31, 2023. This suggests that Thor Industries Inc may have experienced challenges in managing its working capital efficiency during some of these periods.
Overall, the cash conversion cycle measures how efficiently the company is managing its cash flow from operating activities, inventory, and receivables. A declining cycle indicates improved efficiency in converting investments into cash, while an increasing cycle suggests inefficiencies or challenges in working capital management. Thor Industries Inc should continue to monitor and optimize its cash conversion cycle to enhance operational performance and financial health.
Peer comparison
Jul 31, 2024