AZZ Incorporated (AZZ)
Liquidity ratios
| Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | May 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.89 | 1.96 | 1.99 | 2.27 | 2.23 | 1.84 | 1.88 | 2.15 | 2.57 | 2.95 | 2.77 | 2.55 | 2.62 | 2.63 | 1.29 | 1.40 | 1.26 | 2.27 | 2.55 | 2.86 |
| Quick ratio | 0.83 | 0.90 | 0.90 | 0.97 | 0.99 | 0.80 | 0.59 | 1.07 | 1.21 | 1.39 | 1.25 | 1.12 | 1.23 | 1.19 | 0.53 | 0.65 | 0.63 | 1.04 | 1.13 | 1.25 |
| Cash ratio | 0.02 | 0.04 | 0.01 | 0.02 | 0.02 | 0.01 | 0.03 | 0.30 | 0.10 | 0.17 | 0.13 | 0.09 | 0.13 | 0.16 | 0.06 | 0.11 | 0.13 | 0.08 | 0.09 | 0.10 |
AZZ Incorporated's liquidity ratios have shown fluctuations over the past several periods. The current ratio, which measures the company's ability to cover short-term obligations with current assets, has ranged from a low of 1.29 to a high of 2.95. Generally, a current ratio above 1 indicates that the company has more current assets than current liabilities, with higher ratios suggesting a stronger liquidity position.
The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has fluctuated between 0.53 and 1.39. This ratio indicates the company's ability to meet short-term obligations without relying on the sale of inventory, with a ratio above 1 considered favorable.
The cash ratio, which measures the company's ability to cover current liabilities with cash and cash equivalents, has shown a more volatile trend, ranging from 0.01 to 0.30. A higher cash ratio indicates a greater ability to pay off immediate liabilities with cash on hand.
Overall, while the company's current ratio has generally remained above 1, indicating a sufficient level of liquidity, fluctuations in the quick and cash ratios suggest varying levels of short-term liquidity challenges that may warrant further investigation. It is important for the company to maintain a balance between current assets and current liabilities to ensure that it can meet its short-term obligations effectively.
Additional liquidity measure
| Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | May 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 26.52 | 51.90 | 47.61 | 53.00 | 71.77 | 70.66 | 71.56 | 157.85 | 178.00 | 184.65 | 138.30 | 110.72 | 109.43 | 73.41 | 67.21 | 75.58 | 64.61 | 84.56 | 79.81 | 89.12 |
The cash conversion cycle of AZZ Incorporated has fluctuated over the past few reporting periods. The cash conversion cycle is a measure of the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
- In the most recent period (February 29, 2024), the cash conversion cycle was 26.52 days, indicating that the company efficiently converted its resources into cash.
- The cycle increased significantly in the previous period (November 30, 2023) to 51.90 days, suggesting a delay in converting resources into cash flows.
- Prior to that, there was a slight decrease in the cycle in August 31, 2023, compared to the November 30, 2023, indicating improved efficiency.
- However, in May 31, 2023, the cycle increased to 53.00 days, reflecting a longer time to convert resources into cash.
- Further back in February 28, 2023, the cycle was 71.77 days, indicating a relatively longer cycle period.
- The trend continued with similar levels in prior periods, with variations in the cash conversion cycle.
The overall trend shows fluctuations in the cash conversion cycle, signifying changes in the company's efficiency in managing its working capital and operations. It is essential for AZZ Incorporated to monitor and manage its cash conversion cycle effectively to ensure optimal cash flow management and operational efficiency.