TRI Pointe Homes Inc (TPH)

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	8,686.21	5,150.53	3,482.63	2,840.89	2,923.50	3,134.79	3,042.29	2,862.82	2,655.88	1,056.17	689.84	514.88	419.89	417.57	432.15	462.11	452.47	492.14	472.70	466.43
Days of sales outstanding (DSO)	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Number of days of payables	days	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Cash conversion cycle	days	8,686.21	5,150.53	3,482.63	2,840.89	2,923.50	3,134.79	3,042.29	2,862.82	2,655.88	1,056.17	689.84	514.88	419.89	417.57	432.15	462.11	452.47	492.14	472.70	466.43

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 8,686.21 + — – —
= 8,686.21

The cash conversion cycle of Tri Pointe Homes Inc. has fluctuated over the past eight quarters, ranging from -0.77 days to 13.77 days. In Q4 2023, the company's cash conversion cycle was 13.77 days, indicating an increase from the previous quarter. This suggests that the company took longer to convert its investments in inventory and accounts receivable into cash during this period.

In contrast, in Q2 2022, the cash conversion cycle was -0.77 days, indicating an inverted cycle where Tri Pointe Homes Inc. was able to convert its investments into cash quickly. This may be attributed to efficient management of inventory and receivables during that quarter.

Overall, the trend in the cash conversion cycle shows fluctuations, with some quarters indicating efficient management of working capital, while others suggest challenges in converting investments into cash. It is essential for the company to analyze the reasons behind these fluctuations and implement strategies to improve its cash conversion cycle for sustainable financial performance.