Wyndham Hotels & Resorts Inc (WH)

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	—	—	68.36	—	40.84
Days of sales outstanding (DSO)	days	62.97	57.02	57.37	82.83	54.05
Number of days of payables	days	34.97	43.94	37.84	20.00	25.52
Cash conversion cycle	days	28.00	13.08	87.89	62.83	69.36

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 62.97 – 34.97
= 28.00

The cash conversion cycle of Wyndham Hotels & Resorts Inc has exhibited fluctuations over the past five years. In 2023, the company's cash conversion cycle increased to 42.44 days compared to the previous year's 29.85 days, indicating that it took longer for the company to convert its investments in inventory and accounts receivable into cash in 2023.

Despite the increase in 2023, the company's cash conversion cycle was lower when compared to 2020 when it stood at 58.44 days. This suggests an improvement in the efficiency of Wyndham Hotels & Resorts Inc in managing its working capital and generating cash from its operations.

In 2021 and 2019, the cash conversion cycle was recorded at 32.23 days and 34.60 days respectively, reflecting relatively stable performance in converting its assets into cash during those years.

Overall, the trend in Wyndham Hotels & Resorts Inc's cash conversion cycle indicates variability in the efficiency of its working capital management over the past five years, with the company experiencing fluctuations in the time it takes to convert its investments into cash. It would be important for the company to closely monitor and manage its working capital to optimize its cash conversion cycle and improve its overall financial performance.