ANSYS Inc (ANSS)

Ansys Inc.'s liquidity ratios indicate the company's ability to meet short-term obligations with its current assets. The current ratio has remained relatively stable over the past five years, ranging from 2.09 to 2.36, with the latest value standing at 2.30 as of December 31, 2023. This suggests that Ansys has a comfortable level of current assets to cover its current liabilities.

The quick ratio, which excludes inventory from current assets, mirrors the trend of the current ratio, maintaining a similar range of 2.09 to 2.36 over the same period, also at 2.30 as of December 31, 2023. This implies that Ansys has sufficient liquid assets to settle its short-term obligations without relying on inventory.

The cash ratio, which is the most stringent liquidity measure, has fluctuated over the past five years, with the latest reading at 1.02 as of December 31, 2023. This ratio indicates that Ansys has improved its ability to cover its current liabilities with cash alone, although there may still be room for further enhancement.

Overall, Ansys Inc. demonstrates strong liquidity positions across all three ratios, indicating a healthy financial position in terms of short-term solvency.

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Additional liquidity measure

Ansys Inc.'s cash conversion cycle has fluctuated over the past five years. The trend shows an increasing cycle from 2019 to 2021, indicating a longer period of time required to convert resources into cash. This trend reversed in 2022 and 2023, as the cycle decreased, suggesting an improvement in the company's efficiency in managing its working capital.

The company's cash conversion cycle was at its lowest in 2019, at 117.48 days, indicating a quick turnover of cash. However, this increased to 155.65 days in 2021, signaling a longer time taken to convert resources into cash during that year.

In the most recent year, the cash conversion cycle improved to 139.68 days, showing a positive development in the company's working capital management. This indicates that Ansys Inc. was able to reduce the time it takes to convert its investments in inventory and accounts receivable back into cash, which is a positive indicator of operational efficiency.

Overall, Ansys Inc.'s cash conversion cycle analysis reveals fluctuations over the years, with recent improvements suggesting enhanced efficiency in managing working capital and converting resources into cash.