Clear Secure Inc (YOU)
Cash conversion cycle
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 | ||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Days of inventory on hand (DOH) | days | — | — | — | 32.95 | 28.53 | 23.49 | 22.45 | 24.98 | 26.23 | 23.51 | 25.65 | |||
Days of sales outstanding (DSO) | days | 0.32 | 329.36 | 349.81 | 0.31 | 0.47 | 0.64 | 0.73 | 0.98 | 1.97 | 3.22 | 9.34 | |||
Number of days of payables | days | 9.18 | 7.64 | 6.18 | 10.31 | 11.55 | 2.96 | 8.61 | 6.50 | 8.00 | 11.80 | 7.84 | |||
Cash conversion cycle | days | -8.86 | 321.72 | 343.64 | 22.95 | 17.45 | 21.17 | 14.58 | 19.45 | 20.20 | 14.94 | 27.15 |
September 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 0.32 – 9.18
= -8.86
The cash conversion cycle for Clear Secure Inc has shown considerable fluctuations over the past several quarters. In the most recent quarter, ending Sep 30, 2024, the company's cash conversion cycle was negative, indicating a rapid cycle where the company is able to convert its investments in inventory and accounts receivable into cash quickly.
However, the previous quarter, ending Jun 30, 2024, saw a significant increase in the cash conversion cycle to 321.72 days, reflecting a prolonged time required to convert its investments into cash. This spike may indicate inefficiencies in managing inventory and collecting accounts receivable during that period.
Looking back further, the company experienced a high cash conversion cycle of 343.64 days in the quarter ending Mar 31, 2024, followed by a comparatively lower cycle of 22.95 days in the quarter ending Dec 31, 2023.
Overall, Clear Secure Inc's cash conversion cycle has been volatile, with fluctuations between negative cycles indicating efficiency in operations and positive cycles reflecting challenges in managing working capital. It is essential for the company to focus on optimizing inventory levels, improving accounts receivable collection, and managing payable periods to ensure a sustainable and efficient cash conversion cycle in the future.
Peer comparison
Sep 30, 2024