• Spotting Potential Red Flags with the Cash Conversion Cycle

  • 2025/02/06
  • 再生時間: 35 分
  • ポッドキャスト

Spotting Potential Red Flags with the Cash Conversion Cycle

  • サマリー

  • In this episode of the Investing for Beginners podcast, the hosts delve into the intricacies of the cash conversion cycle (CCC), an important metric for evaluating how quickly a company converts cash into inventory and back into cash. They break down key accounting terms like cash, inventory, accounts payable, and accounts receivable, and discuss how these elements are interrelated. By examining real-life examples such as Costco, Amazon, and Walmart, the hosts illustrate how the CCC can highlight a company's operational efficiency and potential red flags. They also touch on differences in business practices and how these reflect on financial metrics, highlighting the importance of cash flow for company stability and growth. 00:00 Welcome to Investing for Beginners 00:10 Understanding the Cash Conversion Cycle 00:37 Breaking Down Key Accounting Terms 01:51 The Importance of Cash Flow 03:38 Accounts Receivable and Payable Explained 05:34 Visualizing Financial Relationships 09:02 Formulas and Financial Metrics 12:23 Real-World Examples and Applications 25:33 Fun with Accounting and Hot Dogs 27:28 Conclusion and Listener Engagement Today’s show is sponsored by: Go to SHOPIFY.COM/beginners to start selling with Shopify today. What do Dave and Andrew recommend? Our free ebook and email series, at stockmarketpdf.com. Find great investments & Connect, Learn and Grow at Value Spotlight Have questions? Send them to newsletter@einvestingforbeginners.com SUBSCRIBE TO THE SHOW Apple | Spotify | YouTube | Amazon | Tunein Learn more about your ad choices. Visit megaphone.fm/adchoices
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あらすじ・解説

In this episode of the Investing for Beginners podcast, the hosts delve into the intricacies of the cash conversion cycle (CCC), an important metric for evaluating how quickly a company converts cash into inventory and back into cash. They break down key accounting terms like cash, inventory, accounts payable, and accounts receivable, and discuss how these elements are interrelated. By examining real-life examples such as Costco, Amazon, and Walmart, the hosts illustrate how the CCC can highlight a company's operational efficiency and potential red flags. They also touch on differences in business practices and how these reflect on financial metrics, highlighting the importance of cash flow for company stability and growth. 00:00 Welcome to Investing for Beginners 00:10 Understanding the Cash Conversion Cycle 00:37 Breaking Down Key Accounting Terms 01:51 The Importance of Cash Flow 03:38 Accounts Receivable and Payable Explained 05:34 Visualizing Financial Relationships 09:02 Formulas and Financial Metrics 12:23 Real-World Examples and Applications 25:33 Fun with Accounting and Hot Dogs 27:28 Conclusion and Listener Engagement Today’s show is sponsored by: Go to SHOPIFY.COM/beginners to start selling with Shopify today. What do Dave and Andrew recommend? Our free ebook and email series, at stockmarketpdf.com. Find great investments & Connect, Learn and Grow at Value Spotlight Have questions? Send them to newsletter@einvestingforbeginners.com SUBSCRIBE TO THE SHOW Apple | Spotify | YouTube | Amazon | Tunein Learn more about your ad choices. Visit megaphone.fm/adchoices
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