We've all heard the mantra "cash is king." But a fistful of dollars today deserves the royal treatment more than a wad of cash down the road. We want our companies turning their products into cash -- fast!

The cash conversion cycle
Enter the cash conversion cycle. It tells us how quickly a company turns cash invested in inventory into cash in the bank after collecting credit sales from customers and paying off its suppliers. The faster a company can turn over its inventory, the more efficiently it's managing its assets. There are three components of the cycle, and here's how they operate:

• Days Inventory Outstanding (DIO)
Inventory sitting on store shelves or in stockrooms is not doing the company, or the investor, any good. The number of days the inventory sits there measures how quickly management can get those Speedos off the racks and onto the beaches of Malibu. Obviously, lower numbers are better.

DIO = 365 days/(cost of goods sold/average inventory)
• Days Sales Outstanding (DSO)
Outstanding sales are those the company hasn't yet been paid for; they're languishing in accounts receivable. We want our companies to not only make quick sales but also get paid for them right away. The faster, the better.

DSO = 365 days/(sales/average accounts receivable)
• Days Payable Outstanding (DPO)
While we want customers to pay us quickly, we want to take our sweet time paying our bills. By paying suppliers slowly, a company has cash available to spend on things it needs, like inventory, so we want this number to be higher.

DPO = 365 days/(cost of goods sold/average accounts payable)

Putting it all together
With the three pieces of the puzzle calculated, we can figure out how long a company is taking to get paid for the products its customers are buying from inventory, minus the number of days it takes it to pay its suppliers. The cash conversion cycle, or CCC, equals DIO + DSO - DPO.

Let's try on a pair of boots and see how the footwear industry stacks up. Here's a look at how a number of the best-known footwear companies turn rawhide into cash.

Company

DIO

+

DSO

-

DPO

=

CCC

CAPS Rating (Out of 5)

Crocs (NASDAQ:CROX)

129.4

+

50.5

-

44.9

=

135.0

*

Deckers (NASDAQ:DECK)

71.0

+

36.7

-

25.8

=

81.9

***

Nike (NYSE:NKE)

85.7

+

55.9

-

31.9

=

109.7

****

Heelys (NASDAQ:HLYS)

23.3

+

38.9

-

6.9

=

55.3

*

Skechers (NYSE:SKX)

73.1

+

56.9

-

49.2

=

80.8

*****

K-Swiss (NASDAQ:KSWS)

80.5

+

54.3

-

19.2

=

115.6

****

Each week, we look for the top companies in different industries that make fast cash, and this particular group seems to have been discounted for the most part by the 31,000-strong Motley Fool CAPS investor-intelligence database of rated investors.

Not every company that makes fast cash will excel. We only want those firms that the CAPS community considers the best. Four- and five-star stocks are the ones the vast majority of CAPS investors believe will outperform the S&P 500.

Of course, this isn't a list of stocks to buy or sell -- just a jumping-off point for further research.

CAPS investors don't seem to mind walking in the company of this group, as half of them have earned the best four- and five-star ratings.

Interestingly, one low-rated company, Heelys, has the best conversion cycle. In large measure that's because of the heavy demand for the wheeled sneaker that's allowed the company to sell it in some 5,700 different store locations. While that's made for a quick cash conversion, CAPS investors ultimately see Heelys as a one-trick, novelty product. Once demand for the sneaker slows, the stock itself will fade.

After Heelys, Skechers has the best cash cycle and is also the highest-rated stock, ahead of even the well-regarded Nike.

• High-ranked CAPS player Persuter notes he's been wearing Skechers for eight years, including with business suits, which is part of the reason he likes the stock so much. "They make all different kinds of shoes, casual skateboard-style, formal black leather, trendy brown suede, women's shoes, children's shoes, etc., etc. I like the diversification and I flat-out like the shoes. Let me put it this way -- I've seen one or two people wearing Crocs, but I see people wearing Skechers all the time.

Plus, a P/E of 18, a P/S of 1.14, and a PEG of 0.8 is a GREAT value. They also took a major hit with their Q2 guidance, but I think the guidance will turn out to be conservative when they actually report. I'm overperforming on CAPS and I'm buying in real life."
• UofMNorthman thinks the market's got it wrong on Skechers: "SKX is a stock that has moved past its 50 day moving average. The shorts are piling up and they have this one wrong. SKX has a new line of shoes to give Crocs a run for their money. Look for Skechers to make a statement this summer. The lines are long at the stores so far this spring and many customers have Skechers in hand. This stock is set for a second run. Look for SKX to go to \$36.30. Hold on for the long haul, I see SKX yielding well above S&P returns over the next 2-4 yrs."

So, are these kicks ready to run, or have they worn a hole in their sole? Work with thousands of your fellow Foolish investors at Motley Fool CAPS to uncover the best stocks and convert your money into cash profits. It's absolutely free -- get started today!

Deckers is a former recommendation of Motley Fool Hidden Gems. A 30-day free trial subscription lets you try on all of the service's current market-beating recommendations. Click here to start yours today.

Fool contributor Rich Duprey does not have a financial position in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.