Verra Mobility Corp (VRRM)
Cash conversion cycle
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 65.43 | 57.10 | 49.64 | 65.39 | 106.25 | 173.67 | 159.25 | 146.64 | 149.11 | 122.88 | 124.35 | 128.14 | 125.59 | 515.83 | 562.26 | 352.48 | 6.89 | 265.02 | 210.94 | 338.02 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 65.43 | 57.10 | 49.64 | 65.39 | 106.25 | 173.67 | 159.25 | 146.64 | 149.11 | 122.88 | 124.35 | 128.14 | 125.59 | 515.83 | 562.26 | 352.48 | 6.89 | 265.02 | 210.94 | 338.02 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 65.43 + — – —
= 65.43
The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash received from sales. A shorter cash conversion cycle indicates that the company is able to generate cash quickly from its operations.
Analyzing the data provided for Verra Mobility Corp, we observe fluctuations in the cash conversion cycle over the quarters. In December 2020, the company had a remarkably low cash conversion cycle of 6.89 days, suggesting efficient management of inventory and collection of receivables. However, in June 2021, the cycle increased significantly to 562.26 days, indicating potential issues with cash flow efficiency or delays in converting assets into cash.
Subsequently, there were fluctuations in the cash conversion cycle over the following quarters, exhibiting a mix of improvements and deteriorations in the company's cash conversion efficiency. The cycle seems to have stabilized towards the end of 2024, with the cycle ranging between 49.64 days to 65.43 days.
Overall, while Verra Mobility Corp has shown fluctuations in its cash conversion cycle, the trend appears to have stabilized towards the end of the period covered in the data. It is essential for the company to continue monitoring and managing its cash conversion cycle effectively to ensure efficient cash flow operations and optimize its working capital management.
Peer comparison
Dec 31, 2024