Watts Water Technologies Inc (WTS)
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 | 120.25 | 133.05 | 124.04 | 129.84 | 108.94 |
| Days of sales outstanding (DSO) | days | — | — | — | — | — |
| Number of days of payables | days | — | — | — | — | — |
| Cash conversion cycle | days | 120.25 | 133.05 | 124.04 | 129.84 | 108.94 |
December 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 120.25 + — – —
= 120.25
Watts Water Technologies Inc's cash conversion cycle has fluctuated over the past five years. As of December 31, 2020, the company's cash conversion cycle was 108.94 days, indicating that it took the company approximately 108.94 days to convert its investments in inventory and other resources into cash flows from sales.
By December 31, 2021, the cash conversion cycle increased to 129.84 days, suggesting a longer period for the company to convert its investments into cash. However, into the following year, by December 31, 2022, there was a slight improvement as the cash conversion cycle decreased to 124.04 days.
In the financial year ending December 31, 2023, the cash conversion cycle rose to 133.05 days, indicating a longer cycle once again. The company managed to make progress by December 31, 2024, with the cash conversion cycle decreasing to 120.25 days, representing a more efficient process of converting investments into cash.
Overall, the trend in Watts Water Technologies Inc's cash conversion cycle shows fluctuations over the years. It is important to monitor this metric closely as a longer cash conversion cycle may tie up company resources and working capital, affecting overall liquidity and profitability.
Peer comparison
Dec 31, 2024