Targa Resources Inc (TRGP)
Cash conversion cycle
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 10.06 | 11.29 | 8.00 | 3.83 | 11.10 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 10.06 | 11.29 | 8.00 | 3.83 | 11.10 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 10.06 + — – —
= 10.06
The cash conversion cycle (CCC) of Targa Resources Inc has shown fluctuations over the years. As of December 31, 2020, the company had a CCC of 11.10 days, indicating that it took approximately 11 days to convert its investments in inventory and accounts receivables into cash inflows. However, by December 31, 2021, the CCC had significantly improved to 3.83 days, suggesting a more efficient management of working capital.
In the following years, there were fluctuations in the CCC, with a slight increase to 8.00 days by December 31, 2022, followed by a peak of 11.29 days by December 31, 2023. This increase may indicate potential challenges in managing liquidity and working capital efficiency. However, the CCC improved to 10.06 days by December 31, 2024, although it remained higher than the levels seen in 2021 and 2022.
Overall, Targa Resources Inc's cash conversion cycle reflects varying levels of efficiency in converting its investments in operating activities into cash receipts over the years, with the company striving to optimize its working capital management.
Peer comparison
Dec 31, 2024