Calix Inc (CALX)

The liquidity ratios of Calix Inc show a positive trend over the years, indicating improved short-term financial health. The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, has been steadily increasing from 2.64 in 2020 to 4.46 in 2024. This suggests that Calix Inc has a strong liquidity position and is capable of meeting its short-term obligations comfortably.

Similarly, the quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, also demonstrates a favorable trend, rising from 1.32 in 2020 to 2.27 in 2024. This indicates that the company can cover its short-term liabilities without relying on selling inventory, which is a positive sign of financial stability.

Furthermore, the cash ratio, which focuses solely on the most liquid assets like cash and equivalents to cover current liabilities, has also shown an upward trajectory, reaching 2.27 in 2024. This implies that Calix Inc has a sufficient amount of cash on hand to meet its immediate payment obligations without relying on other current assets.

Overall, the increasing current, quick, and cash ratios reflect a strengthening liquidity position for Calix Inc, suggesting that the company is well-positioned to manage its short-term financial commitments effectively.

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Additional liquidity measure

The cash conversion cycle of Calix Inc has exhibited fluctuations over the past five years. In 2020, the company's cash conversion cycle stood at 69.57 days, indicating that it took approximately 69.57 days for Calix to convert its investments in inventory and other resources back into cash.

By the end of 2021, the cash conversion cycle had increased to 100.50 days, suggesting a longer period for the company to convert its assets into cash. This extended cycle may raise concerns about liquidity and operational efficiency.

In 2022, the cash conversion cycle further increased to 125.91 days, showing a notable delay in the company's ability to convert its investments into cash, which may lead to working capital challenges.

However, by the end of 2023, there was a slight improvement in the cash conversion cycle, reducing to 93.12 days. This reduction could indicate that Calix had taken steps to improve its working capital management.

In 2024, the cash conversion cycle increased again to 99.21 days, showing some instability in the company's ability to efficiently manage its working capital and convert its assets into cash within a reasonable timeframe.

Overall, the trend in the cash conversion cycle of Calix Inc over the past five years highlights the importance of monitoring operational efficiency, inventory management, and cash flow to ensure the company's financial health and sustainability.