Vector Group Ltd (VGR)
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 | 30.96 | 33.79 | 44.88 | 43.44 | 69.66 |
| Days of sales outstanding (DSO) | days | 6.78 | 12.44 | 8.08 | 12.09 | 12.05 |
| Number of days of payables | days | 2.27 | 2.32 | 4.48 | 2.90 | 7.21 |
| Cash conversion cycle | days | 35.46 | 43.91 | 48.48 | 52.64 | 74.50 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 30.96 + 6.78 – 2.27
= 35.46
The cash conversion cycle of Vector Group Ltd has exhibited fluctuations over the past five years. In 2023, the company's cash conversion cycle decreased to 38.99 days from 43.91 days in 2022, indicating an improvement in the efficiency of converting resources into cash. This reduction suggests that Vector Group Ltd is managing its inventory, accounts receivable, and accounts payable more effectively in the current year.
Comparing 2023 to 2021 and 2020, the trend continues to be positive, with a noticeable decline in the cash conversion cycle. This demonstrates that Vector Group Ltd has been working on streamlining its operations and optimizing its working capital management, potentially leading to quicker turnaround times in converting investments into cash.
Moreover, when compared to the most recent years, 2019 and 2020, the cash conversion cycle in 2023 and 2022 is at a more favorable level. This indicates that Vector Group Ltd has made progress in enhancing its operational efficiency and liquidity management.
Overall, the decreasing trend observed in Vector Group Ltd's cash conversion cycle over the years reflects positive developments in the company's ability to efficiently manage its working capital, which is crucial for sustaining cash flows and supporting ongoing business operations.
Peer comparison
Dec 31, 2023