Verisk Analytics Inc (VRSK)

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	35.19	197.55	43.87	37.44	28.03
Days of sales outstanding (DSO)	days	50.66	51.72	61.39	63.15	68.89
Number of days of payables	days	—	—	—	—	—
Cash conversion cycle	days	85.85	249.27	105.25	100.58	96.91

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 35.19 + 50.66 – —
= 85.85

Verisk Analytics Inc's cash conversion cycle has shown a decreasing trend over the past five years, reflecting improved efficiency in its working capital management. The company's cash conversion cycle decreased from 65.45 days in 2019 to 48.69 days in 2023. This indicates that the company is able to convert its inventory and receivables into cash more quickly, which is a positive sign for its liquidity and overall financial health. The decreasing trend suggests that Verisk Analytics is managing its inventory, accounts receivable, and accounts payable more effectively, leading to a shorter operating cycle and faster cash generation. Overall, the company's improving cash conversion cycle is a good indicator of its operational efficiency and ability to convert its operational activities into cash effectively.