ADMA Biologics Inc (ADMA)

ADMA Biologics Inc has shown a consistent trend of strong liquidity ratios over the past five years. The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, has ranged from 5.16 to 7.71 during this period. This indicates that the company has more than enough current assets to cover its current liabilities, providing a buffer for potential financial disruptions.

The quick ratio, which is a more stringent measure of liquidity as it excludes inventory from current assets, has also remained robust, ranging from 1.58 to 3.47. This shows that even without considering inventory, ADMA Biologics Inc has a strong ability to meet its short-term obligations using its most liquid assets.

Moreover, the cash ratio, which focuses only on the most liquid assets (cash and cash equivalents) relative to current liabilities, has ranged from 1.03 to 2.80. This indicates that the company has a solid level of cash reserves to cover its short-term liabilities without relying on other current assets.

Overall, the liquidity ratios of ADMA Biologics Inc suggest a strong financial position with ample resources to meet its short-term obligations and operational needs. This level of liquidity provides a cushion against potential cash flow pressures and indicates a prudent approach to managing its working capital.

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Additional liquidity measure

The cash conversion cycle of ADMA Biologics Inc has shown fluctuating trends over the past five years. In 2023, the cash conversion cycle decreased to 377.83 days, indicating an improvement in the company's ability to convert its investments in inventory and accounts receivable into cash. This may suggest better management of working capital and more efficient operations.

In 2022, the cash conversion cycle increased significantly to 497.69 days, reflecting a slower conversion of resources into cash compared to the previous year. This could signal challenges in managing inventory levels, collecting receivables, or extending payment terms to suppliers.

The trend continued in 2021 with a further increase to 642.69 days, pointing to prolonged periods of tying up cash in the operating cycle. This could potentially strain liquidity and working capital management.

The cash conversion cycle improved in 2020 to 534.05 days, although it remained relatively high compared to previous years. The company may have taken steps to streamline its operations and optimize its working capital efficiency during that period.

In 2019, the cash conversion cycle was at 448.68 days, indicating a relatively efficient working capital management compared to the following years. Overall, fluctuations in the cash conversion cycle of ADMA Biologics Inc suggest variability in the company's ability to efficiently manage its cash flow and working capital over the past five years.