WESCO International Inc (WCC)
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 | 74.32 | 77.19 | 73.92 | 73.59 | 74.33 | 73.53 | 75.20 | 79.19 | 76.20 | 78.33 | 73.41 | 69.75 | 67.46 | 67.29 | 65.52 | 71.84 | 78.99 | 103.04 | 128.23 | 51.09 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Cash conversion cycle | days | 74.32 | 77.19 | 73.92 | 73.59 | 74.33 | 73.53 | 75.20 | 79.19 | 76.20 | 78.33 | 73.41 | 69.75 | 67.46 | 67.29 | 65.52 | 71.84 | 78.99 | 103.04 | 128.23 | 51.09 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 74.32 + — – —
= 74.32
The cash conversion cycle of WESCO International Inc has shown fluctuations over the period from March 31, 2020, to December 31, 2024. The cash conversion cycle represents the time taken by a company to convert its investments in inventory and other resources into cash flows from sales.
Initially, on March 31, 2020, the cash conversion cycle was 51.09 days, indicating a relatively efficient conversion of inventory and receivables into cash. However, the cycle significantly increased to 128.23 days by June 30, 2020, possibly due to extended payment terms or slower inventory turnover.
Subsequently, there was a gradual improvement in the cash conversion cycle, reaching a low of 65.52 days by June 30, 2021. This suggests better management of working capital and more efficient operations in converting assets into cash.
The cycle slightly increased again to 78.33 days by September 30, 2022, before stabilizing around 74 days by the end of 2024. A lower cash conversion cycle is generally favorable as it signifies quicker cash generation and better liquidity management within the business.
Overall, WESCO International Inc's management should continue to focus on optimizing inventory turnover, credit terms, and collections to maintain an efficient cash conversion cycle, which is crucial for the company's financial health and operational efficiency.
Peer comparison
Dec 31, 2024