Smith AO Corporation (AOS)

Liquidity ratios

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020
Current ratio 1.55 1.67 1.70 1.65 1.59 1.68 1.81 1.84 1.75 1.74 1.76 1.72 1.57 1.77 1.75 1.86 1.83 1.77 1.96 2.06
Quick ratio 0.91 0.96 1.01 1.00 1.01 1.04 1.16 1.21 1.14 1.09 1.16 1.19 1.13 1.33 1.31 1.44 1.44 1.34 1.47 1.54
Cash ratio 0.31 0.30 0.27 0.34 0.38 0.38 0.48 0.55 0.52 0.46 0.49 0.58 0.56 0.70 0.64 0.80 0.78 0.63 0.77 0.79

The current ratio of Smith AO Corporation has shown a downward trend over the past few years, declining from 2.06 in March 2020 to 1.55 by December 2024. This indicates a weakening ability to cover its short-term obligations with current assets.

Similarly, the quick ratio also demonstrates a decreasing trend, falling from 1.54 in March 2020 to 0.91 by December 2024. The quick ratio provides a more stringent measure of liquidity, excluding inventory from current assets, and reveals the company's dwindling ability to meet immediate financial obligations using its most liquid assets.

Lastly, the cash ratio, which measures the firm's ability to pay off current liabilities solely with cash and cash equivalents, has also exhibited a declining pattern from 0.79 in March 2020 to 0.31 by December 2024. This signals a reduced capacity to settle short-term debts promptly using cash reserves alone.

Overall, the liquidity ratios of Smith AO Corporation have been on a downward trajectory, indicating potential liquidity challenges in meeting its short-term obligations as time has progressed.

Additional liquidity measure

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020
Cash conversion cycle days 45.17 52.24 57.02 51.19 44.62 51.55 53.35 51.89 43.81 46.05 43.95 39.37 28.51 29.50 30.38 30.91 30.29 42.28 48.35 47.45

The cash conversion cycle of Smith AO Corporation has shown some fluctuations over the past few years. Initially, the company's cash conversion cycle was around 47-48 days in the first half of 2020, indicating that the company took nearly 47-48 days to convert its investment in inventory into cash.

However, there was a significant improvement in the company's efficiency as the cash conversion cycle reduced steadily throughout 2020 and into 2021, reaching a low of around 28-30 days by the end of 2021. This suggested that Smith AO Corporation was managing its working capital more effectively, possibly through better inventory management and faster collection of receivables.

Subsequently, there was a slight increase in the cash conversion cycle in the first half of 2022, indicating a potential slowdown in the company's cash conversion efficiency. However, it remained relatively stable around 43-46 days until the end of 2023, indicating that the company was still maintaining reasonable control over its working capital.

By the end of 2024, there was a noticeable uptick in the cash conversion cycle to around 45-57 days, suggesting that Smith AO Corporation may have faced some challenges in managing its working capital efficiently during that period.

Overall, while there have been fluctuations in the cash conversion cycle of Smith AO Corporation, the general trend has shown improvement in efficiency up to the end of 2021, followed by some volatility in the subsequent years. Monitoring and managing the cash conversion cycle will be crucial for the company to ensure optimal cash flow and working capital management in the future.