CDW Corp (CDW)
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 | 1.35 | 1.40 | 1.13 | 1.26 | 1.23 | 1.35 | 1.30 | 1.31 | 1.33 | 1.29 | 1.30 | 1.26 | 1.27 | 1.38 | 1.44 | 1.47 | 1.53 | 1.50 | 1.47 | 1.28 |
| Quick ratio | 0.13 | 0.21 | 0.11 | 0.15 | 0.11 | 0.09 | 0.04 | 0.06 | 0.06 | 0.07 | 0.10 | 0.07 | 0.05 | 0.06 | 0.13 | 0.24 | 0.36 | 0.33 | 0.27 | 0.06 |
| Cash ratio | 0.13 | 0.21 | 0.11 | 0.15 | 0.11 | 0.09 | 0.04 | 0.06 | 0.06 | 0.07 | 0.10 | 0.07 | 0.05 | 0.06 | 0.13 | 0.24 | 0.36 | 0.33 | 0.27 | 0.06 |
CDW Corp's liquidity ratios have shown fluctuations over the review period. The current ratio, which indicates the company's ability to cover short-term liabilities with current assets, fluctuated between 1.13 to 1.50. The company maintained a current ratio above 1, suggesting it had more current assets than current liabilities, providing a buffer against potential liquidity issues.
The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, ranged from 0.04 to 0.36. The lower values indicate that CDW Corp may have had difficulty meeting its short-term obligations without selling inventory. However, the quick ratio improved over time, reflecting better liquidity management.
The cash ratio, representing the most conservative assessment of liquidity by measuring the ability to cover current liabilities with only cash and cash equivalents, was relatively low, ranging from 0.04 to 0.36. This suggests that CDW Corp held minimal cash reserves compared to its current liabilities, indicating potential reliance on other current assets or sources of funding to meet short-term obligations.
Overall, CDW Corp's liquidity ratios demonstrate a mix of strengths and areas for improvement in managing short-term liquidity needs. The company should continue monitoring and optimizing its liquidity position to ensure it can meet its financial obligations effectively.
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 | 13.47 | 15.38 | 16.25 | 14.86 | 14.61 | 15.06 | 16.29 | 15.64 | 15.32 | 17.24 | 19.84 | 21.32 | 19.62 | 18.38 | 19.89 | 17.36 | 18.18 | 15.83 | 16.79 | 15.99 |
The cash conversion cycle of CDW Corp has shown some fluctuations over the past years, ranging from a low of 13.47 days to a high of 21.32 days. Generally, a lower cash conversion cycle is desirable as it indicates that the company is able to convert its investments in inventory and accounts receivable into cash quickly.
Analyzing the trend of CDW Corp's cash conversion cycle, we observe that there was an increase from the end of 2021 to the first quarter of 2022, reaching a peak of 21.32 days. However, there has been a subsequent decrease in the cash conversion cycle over the next quarters, with a notable improvement by the end of 2024, where it stood at 13.47 days, indicating efficient management of working capital.
It is important for CDW Corp to continue monitoring and managing its cash conversion cycle effectively to ensure optimal utilization of resources and maintain healthy liquidity levels. A well-managed cash conversion cycle can enhance the company's financial performance and overall stability in the long run.