Vontier Corp (VNT)
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 | 160.44 | 137.91 | 49.00 | 44.32 | 40.74 |
| Days of sales outstanding (DSO) | days | 77.54 | 71.22 | 72.22 | 71.45 | 73.66 |
| Number of days of payables | days | 179.58 | 170.55 | 61.02 | 65.61 | 64.04 |
| Cash conversion cycle | days | 58.40 | 38.58 | 60.20 | 50.15 | 50.36 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 160.44 + 77.54 – 179.58
= 58.40
Based on the provided data for Vontier Corp's cash conversion cycle, there has been some fluctuation over the years. The cash conversion cycle, which represents the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales, has varied as follows:
- As of December 31, 2020, the cash conversion cycle stood at 50.36 days.
- By December 31, 2021, there was a slight improvement, with the cycle declining to 50.15 days.
- A notable increase occurred by December 31, 2022, where the cycle extended to 60.20 days, indicating a potential delay in converting investments into cash.
- There was a significant improvement by December 31, 2023, as the cash conversion cycle decreased to 38.58 days, suggesting more efficient operations in converting investments into cash flows.
- However, by December 31, 2024, the cycle increased again to 58.40 days, returning to a longer conversion period, which may require further analysis to understand the reasons behind this shift.
These fluctuations in Vontier Corp's cash conversion cycle highlight the importance of monitoring working capital management efficiency and identifying opportunities to optimize the cash conversion process for better financial performance.
Peer comparison
Dec 31, 2024