Versum Materials (Versum Materials) Cash Conversion Cycle : 93.10 (As of Jun. 2019)

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What is Versum Materials Cash Conversion Cycle?

Cash Conversion Cycle is one of several measures of management effectiveness. It equals Days Sales Outstanding + Days Inventory - Days Payable.

Versum Materials's Days Sales Outstanding for the three months ended in Jun. 2019 was 49.86.
Versum Materials's Days Inventory for the three months ended in Jun. 2019 was 100.64.
Versum Materials's Days Payable for the three months ended in Jun. 2019 was 57.4.
Therefore, Versum Materials's Cash Conversion Cycle (CCC) for the three months ended in Jun. 2019 was 93.10.

Versum Materials Cash Conversion Cycle Historical Data

The historical data trend for Versum Materials's Cash Conversion Cycle can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Versum Materials Cash Conversion Cycle Chart

Versum Materials Annual Data

Trend

Sep13

Sep14

Sep15

Sep16

Sep17

Sep18

Cash Conversion Cycle

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92.70

94.29

106.67

99.12

93.86

Versum Materials Quarterly Data
	Sep13	Sep14	Jun15	Sep15	Dec15	Mar16	Jun16	Sep16	Dec16	Mar17	Jun17	Sep17	Dec17	Mar18	Jun18	Sep18	Dec18	Mar19	Jun19
Cash Conversion Cycle	Get a 7-Day Free Trial														80.51	87.18	92.66	89.12	93.10

Competitive Comparison of Versum Materials's Cash Conversion Cycle

For the Chemicals subindustry, Versum Materials's Cash Conversion Cycle, along with its competitors' market caps and Cash Conversion Cycle data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Versum Materials's Cash Conversion Cycle Distribution in the Chemicals Industry

For the Chemicals industry and Basic Materials sector, Versum Materials's Cash Conversion Cycle distribution charts can be found below:

* The bar in red indicates where Versum Materials's Cash Conversion Cycle falls into.

Versum Materials Cash Conversion Cycle Calculation

Cash Conversion Cycle (CCC) measures how fast a company can convert cash on hand into even more cash on hand. This metric looks at the amount of time needed to sell inventory, the amount of time needed to collect receivables and the length of time the company is afforded to pay its bills without incurring penalties.

Cash Conversion Cycle is one of several measures of management effectiveness.

Versum Materials's Cash Conversion Cycle for the fiscal year that ended in Sep. 2018 is calculated as

Cash Conversion Cycle	=	Days Sales Outstanding	+	Days Inventory	-	Days Payable
	=	43.85	+	78.15	-	28.14
	=	93.86

Versum Materials's Cash Conversion Cycle for the quarter that ended in Jun. 2019 is calculated as:

Cash Conversion Cycle	=	Days Sales Outstanding	+	Days Inventory	-	Days Payable
	=	49.86	+	100.64	-	57.4
	=	93.10

Versum Materials (NYSE:VSM) Cash Conversion Cycle Explanation

Generally, the lower this number is, the better for the company. Although it should be combined with other metrics (such as ROE % and ROA %), it can be especially useful for comparing close competitors, because the company with the lowest CCC is often the one with better management.

Be Aware

CCC is most effective with retail-type companies, which have inventories that are sold to customers. Consulting businesses, software companies and insurance companies are all examples of companies for whom this metric is meaningless.

The CCC is one of several tools that can help you evaluate management, especially if it is calculated for several consecutive time periods and for several competitors. Decreasing or steady CCCs are good, while rising ones should motivate you to dig a bit deeper.

Versum Materials Cash Conversion Cycle Related Terms

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Versum Materials (Versum Materials) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Chemicals » Versum Materials Inc (NYSE:VSM) » Definitions » Cash Conversion Cycle

Comparable Companies

Traded in Other Exchanges

N/A

Address

8555 South River Parkway, Tempe, AZ, USA, 85284

Website

https://www.versummaterials.com

Versum Materials is a leading global provider of electronic materials for the integrated circuit and flat-panel display markets. It supplies specialty chemicals and materials, high-purity specialty gases, proprietary delivery systems, and related services. The semiconductor industry accounts for 85% of sales. Versum generated fiscal 2017 revenue and adjusted EBIT of $1,127 million and $326 million, respectively. Versum employs almost 2,000 and serves 250 customers from its global network of 14 production sites and six R&D facilities.

Executives

Alejandro Daniel Wolff	director	ALBEMARLE CORP., 451 FLORIDA ST, BATON ROUGE LA 70801
Seifi Ghasemi	director	100 OVERLOOK CENTER, PRINCETON NJ 08540
Guillermo Novo	director, officer: President and CEO	AIR PRODUCTS AND CHEMICALS, INC., 7201 HAMILTON BOULEVARD, ALLENTOWN PA 18195
Susan C Schnabel	director	C/O CREDIT SUISSE FIRST BOSTON, 11 MADISON AVE, NEW YORK NY 10010
Yi Hyon Paik	director	ROHM AND HAAS COMPANY, 100 INDEPENDENCE MALL WEST, PHILADELPHIA PA 19106
Jacques M Croisetiere	director	C/O MORTON INTERNATIONAL INC, 100 N RIVERSIDE PLZ, CHICAGO IL 60606