Union Pacific Corporation (UNP)
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 | 28.74 | 26.60 | 25.88 | 27.14 | 30.61 |
| Days of sales outstanding (DSO) | days | 28.20 | 32.62 | 28.57 | 30.30 | 28.12 |
| Number of days of payables | days | 31.65 | 30.65 | 27.38 | 32.87 | 29.37 |
| Cash conversion cycle | days | 25.29 | 28.58 | 27.07 | 24.57 | 29.37 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 28.74 + 28.20 – 31.65
= 25.29
Based on the data provided, Union Pacific Corporation's cash conversion cycle has shown fluctuations over the past five years. In 2020, the cash conversion cycle was 29.37 days, indicating the time it takes for the company to convert its investment in inventory and other resources into cash.
However, there was an improvement in efficiency in 2021, with the cash conversion cycle decreasing to 24.57 days. This suggests that Union Pacific Corporation was able to manage its working capital more effectively and generate cash more quickly.
In 2022, the cash conversion cycle slightly increased to 27.07 days, indicating a slightly longer time to convert investments into cash compared to the previous year. The cycle then increased further to 28.58 days in 2023, showing a potential slowdown in the cash conversion process.
In the most recent year, 2024, the cash conversion cycle decreased to 25.29 days, indicating a slight improvement in cash conversion efficiency compared to the previous year.
Overall, despite some fluctuations, Union Pacific Corporation has generally been managing its cash conversion cycle effectively over the past five years, with efforts to optimize working capital and streamline cash flow operations.
Peer comparison
Dec 31, 2024