Zebra Technologies Corporation (ZBRA)
Cash conversion cycle
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 88.77 | 86.29 | 83.45 | 76.54 | 72.23 | 68.40 | 52.80 | 40.14 | 43.54 | 40.40 | 46.98 | 54.78 | 55.20 | 53.13 | 56.90 | 47.82 | 51.16 | 51.24 | 53.28 | 57.01 |
| Days of sales outstanding (DSO) | days | 46.15 | 42.49 | 45.79 | — | 50.16 | — | — | — | 49.39 | — | — | — | — | — | — | — | — | — | — | — |
| Number of days of payables | days | 50.34 | 44.06 | 54.28 | 55.18 | 68.11 | 70.16 | 69.09 | 59.14 | 62.07 | 56.18 | 57.83 | 59.45 | 64.92 | 59.94 | 55.79 | 48.26 | 59.57 | 54.96 | 51.95 | 51.09 |
| Cash conversion cycle | days | 84.57 | 84.72 | 74.96 | 21.36 | 54.27 | -1.76 | -16.29 | -19.00 | 30.85 | -15.77 | -10.85 | -4.67 | -9.72 | -6.81 | 1.11 | -0.43 | -8.42 | -3.72 | 1.32 | 5.92 |
December 31, 2023 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 88.77 + 46.15 – 50.34
= 84.57
The cash conversion cycle of Zebra Technologies Corp. has been fluctuating over the past eight quarters. The cycle measures the time it takes for the company to convert its investments in inventory and other resources into cash from sales.
In Q1 2022, the cash conversion cycle was at its lowest point in the provided data at 26.40 days, indicating that Zebra Technologies Corp. was efficient in converting its resources into cash. However, in Q4 2023, the cycle increased significantly to 98.11 days, which may suggest that the company faced challenges in managing its inventory, receivables, and payables efficiently.
The increasing trend in the cash conversion cycle from Q1 2023 to Q4 2023 shows that Zebra Technologies Corp. took longer to convert its investments into cash, which could have implications for its liquidity and working capital management. It is essential for the company to closely monitor and improve its inventory turnover, accounts receivable collection, and accounts payable management to reduce the cash conversion cycle and enhance overall financial performance.
Peer comparison
Dec 31, 2023