The TJX Companies Inc (TJX)

Cash conversion cycle

		Jan 31, 2025	Feb 3, 2024	Jan 31, 2024	Jan 31, 2023	Jan 28, 2023
Days of inventory on hand (DOH)	days	59.92	44.09	57.37	58.76	46.00
Days of sales outstanding (DSO)	days	—	3.97	—	—	4.97
Number of days of payables	days	—	28.55	—	—	29.99
Cash conversion cycle	days	59.92	19.51	57.37	58.76	20.98

January 31, 2025 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 59.92 + — – —
= 59.92

The cash conversion cycle of The TJX Companies Inc has shown fluctuations over the years. In January 2023, the cash conversion cycle was 20.98 days, indicating a relatively efficient process in converting inventory into cash. However, by January 2024, the cycle increased to 57.37 days, reflecting potential delays in converting inventory into sales and cash. Subsequently, in February 2024, the cycle decreased significantly to 19.51 days, suggesting improvements in inventory turnover and cash flow management. Nevertheless, by January 2025, the cycle rose again to 59.92 days, indicating a longer period for converting inventory into sales and ultimately cash. Overall, The TJX Companies Inc should focus on optimizing its inventory management and sales processes to maintain a more consistent and efficient cash conversion cycle.