TripAdvisor Inc (TRIP)
Cash conversion cycle
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | 40.18 | 43.49 | 65.51 | 77.11 | 41.34 |
| Number of days of payables | days | 7.36 | 12.16 | 11.99 | 9.21 | 4.03 |
| Cash conversion cycle | days | 32.83 | 31.33 | 53.52 | 67.90 | 37.31 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 40.18 – 7.36
= 32.83
The cash conversion cycle of TripAdvisor Inc. has shown fluctuations over the past five years. The company's ability to efficiently convert its resources into cash improved significantly from 2019 to 2020, as the cash conversion cycle decreased from 0.10 days to -39.08 days. This indicates that TripAdvisor was able to convert its investments in inventory and accounts receivable into cash more rapidly in 2020.
However, in the subsequent years, the cash conversion cycle varied. In 2021, the cycle decreased further to -55.89 days, indicating continued efficiency in cash conversion. The following year, in 2022, there was a significant decrease in efficiency as the cycle extended to -72.56 days, suggesting potential challenges in managing working capital.
The latest data from 2023 shows a notable improvement, with the cash conversion cycle decreasing to -29.40 days. This indicates that TripAdvisor has been able to streamline its operations and leverage its working capital more effectively to generate cash.
Overall, while there have been fluctuations in the cash conversion cycle of TripAdvisor Inc. over the past five years, the recent improvement in 2023 suggests efforts towards enhancing operational efficiency and optimizing working capital management.
Peer comparison
Dec 31, 2023