Buckle Inc (BKE)

Based on the liquidity ratios of Buckle Inc over the past five years, we can observe the following trends:

1. Current Ratio:
- The current ratio has fluctuated over the years, ranging from a low of 1.57 in January 2022 to a high of 2.19 in February 2020.
- The current ratio indicates that Buckle Inc has generally had more than enough current assets to cover its current liabilities. A ratio above 1.0 suggests the company has the ability to meet its short-term obligations.

2. Quick Ratio:
- Similar to the current ratio, the quick ratio has also fluctuated, with the lowest point at 1.12 in January 2022 and the highest at 1.57 in February 2020.
- The quick ratio, which excludes inventory from current assets, provides a more conservative measure of liquidity. Buckle Inc has generally maintained a healthy quick ratio above 1.0, indicating its ability to pay off its short-term obligations without relying on selling inventory.

3. Cash Ratio:
- The cash ratio, representing the most stringent liquidity measure, has also varied over the years. The lowest ratio was observed in January 2022 at 1.07, while the highest was in February 2020 at 1.35.
- The cash ratio shows the proportion of current liabilities that could be paid off with the cash and cash equivalents on hand. Buckle Inc has generally maintained a cash ratio above 1.0, indicating a strong ability to meet short-term obligations using cash resources.

Overall, Buckle Inc has demonstrated solid liquidity positions over the past five years, with current, quick, and cash ratios consistently above 1.0. This suggests the company has the ability to meet its short-term financial obligations without significant difficulty, providing a level of financial stability and flexibility.

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Additional liquidity measure

The cash conversion cycle of Buckle Inc has shown varying trends over the past five years.

In Jan 2022, the company's cash conversion cycle was at its lowest point over the period at 19.45 days, indicating a shorter time taken to convert investments in inventory and other resources back into cash. This suggests the company managed its working capital efficiently during that period.

However, in Feb 2020, the cash conversion cycle was at its highest point of 46.27 days, signifying a longer period required to convert investments into cash. This may indicate potential inefficiencies in managing inventory, sales, and payables during that year.

In the recent fiscal year, as of Feb 3, 2024, the cash conversion cycle was 32.13 days, which is relatively stable compared to prior years. This could imply that the company has maintained a consistent approach to managing its working capital and operations.

Overall, analyzing the trend of Buckle Inc's cash conversion cycle provides insight into the company's efficiency in managing its liquidity, inventory, and receivables, which are crucial factors impacting its financial performance.