Academy Sports Outdoors Inc (ASO)

Academy Sports Outdoors Inc's liquidity ratios have shown some fluctuations over the past few years. The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, has been relatively stable, ranging from 1.62 to 1.87. This indicates that the company has sufficient current assets to meet its current liabilities.

In contrast, the quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has shown more variability, ranging from 0.30 to 0.42. A declining trend in the quick ratio may suggest that the company is becoming less able to meet its short-term obligations without relying on inventory liquidation.

Furthermore, the cash ratio, which specifically looks at the proportion of cash and cash equivalents to current liabilities, has also fluctuated between 0.30 and 0.40. This ratio indicates the company's ability to settle its short-term liabilities using only its cash reserves.

Overall, while the current ratio generally indicates a healthy liquidity position for Academy Sports Outdoors Inc, the fluctuating quick and cash ratios may warrant closer monitoring to ensure the company's ability to meet its short-term obligations without relying heavily on inventory or other current assets.

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Additional liquidity measure

The cash conversion cycle of Academy Sports Outdoors Inc fluctuated over the period analyzed. At the beginning of the period, on January 28, 2023, the company had a relatively efficient cash conversion cycle of 40.19 days. However, this efficiency deteriorated by January 31, 2023, with the cycle significantly increasing to 112.01 days, indicating a longer time taken to convert inputs into cash.

From January 31, 2023, to January 31, 2025, the cash conversion cycle exhibited fluctuations, showing both improvements and deteriorations. By January 31, 2024, the cycle had reduced to 107.65 days but then increased again by February 3, 2024, to 44.58 days, which was closer to the initial efficiency observed.

The cycle peaked on January 31, 2025, reaching 121.81 days, indicating an extended time taken for the company to convert its resources into cash. Such a prolonged cycle can lead to liquidity challenges and affect the company's overall financial health. Overall, the varying trends in the cash conversion cycle highlight the importance of closely monitoring operational efficiency and working capital management within Academy Sports Outdoors Inc.