Tempur Sealy International Inc (TPX)
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 | 63.05 | 62.46 | 67.17 | 72.25 | 70.54 | 74.66 | 76.15 | 73.07 | 61.08 | 54.27 | 49.11 | 53.92 | 55.88 | 51.54 | 52.19 | 54.83 | 53.91 | 59.12 | 54.07 | 54.05 |
| Days of sales outstanding (DSO) | days | 33.81 | 38.83 | 35.12 | 34.45 | 31.34 | 34.99 | 34.01 | 30.36 | 31.05 | 40.24 | 38.35 | 37.21 | 38.09 | 46.09 | 39.23 | 42.03 | 43.72 | 54.07 | 50.01 | 47.03 |
| Number of days of payables | days | 40.63 | 46.53 | 46.02 | 46.93 | 45.73 | 54.87 | 53.21 | 58.11 | 56.88 | 65.34 | 52.52 | 47.12 | 58.03 | 61.89 | 49.83 | 53.21 | 52.09 | 60.30 | 52.38 | 55.41 |
| Cash conversion cycle | days | 56.23 | 54.76 | 56.27 | 59.77 | 56.16 | 54.78 | 56.95 | 45.32 | 35.25 | 29.17 | 34.94 | 44.01 | 35.94 | 35.74 | 41.59 | 43.65 | 45.54 | 52.89 | 51.70 | 45.67 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 63.05 + 33.81 – 40.63
= 56.23
The cash conversion cycle of Tempur Sealy International Inc has shown some variation over the past eight quarters. In Q1 2022, the company had a relatively lower cash conversion cycle of 45.32 days, indicating that it took approximately 45.32 days to convert its investments in inventory and other resources into cash inflows from sales. This was followed by an increasing trend in Q2 and Q3 2022, reaching a peak of 56.95 days in Q3 2022.
However, the company managed to reduce its cash conversion cycle in Q4 2022 and Q1 2023 to 56.16 days and 59.77 days, respectively, indicating that it took longer to convert investments into cash during these periods. In Q2 2023, the cash conversion cycle further increased to 56.27 days before slightly declining in Q3 2023 to 54.76 days. The most recent data from Q4 2023 shows a cash conversion cycle of 54.39 days.
Overall, Tempur Sealy International Inc's cash conversion cycle has fluctuated within a range of 45.32 days to 59.77 days over the past eight quarters. A lower cash conversion cycle indicates a more efficient management of working capital, while a higher cycle suggests potential inefficiencies in converting investments into cash inflows. Monitoring and managing the cash conversion cycle can help the company improve its liquidity and operational efficiency.
Peer comparison
Dec 31, 2023