Cognex Corporation (CGNX)

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 3.62 3.94 4.03 3.52 4.47 4.99 3.98 3.37 3.82 4.88 3.82 3.45 3.39 4.07 3.38 3.92 4.55 4.51 4.47 3.95
Quick ratio 2.32 2.62 2.67 2.23 2.95 3.80 2.88 1.78 2.81 2.94 1.87 1.61 2.43 2.38 1.99 2.42 2.81 2.82 2.97 2.64
Cash ratio 1.45 1.69 1.71 1.48 2.19 3.02 2.04 1.78 2.13 2.94 1.87 1.61 1.72 2.38 1.99 2.42 2.81 2.82 2.97 2.64

Cognex Corporation's liquidity ratios, as indicated by the current ratio, quick ratio, and cash ratio, depict the company's ability to meet its short-term financial obligations.

1. Current Ratio: Cognex Corporation has generally maintained a healthy current ratio over the reported periods, with values consistently above 3. This indicates that the company has more than enough current assets to cover its current liabilities, suggesting a strong liquidity position.

2. Quick Ratio: The quick ratio of Cognex Corporation shows a slightly lower but still acceptable level compared to the current ratio. The quick ratio considers only the most liquid assets (such as cash and accounts receivable) relative to current liabilities, providing a more conservative measure of liquidity. Despite slight fluctuations, the quick ratio remains above 1 over the periods, indicating the company's ability to meet its short-term obligations without relying heavily on inventory.

3. Cash Ratio: The cash ratio of Cognex Corporation reflects the company's ability to settle its current liabilities solely with cash and cash equivalents. While showing some variability, the cash ratio generally remains above 1, indicating that the company has sufficient cash reserves to cover its short-term obligations.

Overall, based on the liquidity ratios analyzed, Cognex Corporation appears to have a strong liquidity position, with the ability to meet its short-term financial obligations comfortably across the reported periods.

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 122.72 136.65 150.01 149.10 140.40 94.79 97.25 35.46 79.51 52.15 43.53 53.99 90.22 45.48 33.22 36.90 42.34 23.47 25.95 30.55

The cash conversion cycle of Cognex Corporation has shown fluctuations over the quarters provided in the data. The cash conversion cycle is a key metric that measures the time it takes for a company to convert its investments in inventory into cash from sales of the inventory.

From the data provided, we observe that the cash conversion cycle ranged from a low of 23.47 days in September 2020 to a high of 150.01 days in June 2024. The trend in the cash conversion cycle shows periods of fluctuation, with some quarters indicating improvements in efficiency (e.g., June 2020) and others showing deterioration (e.g., June 2024).

A shorter cash conversion cycle generally suggests that the company is more efficient in managing its working capital, turning inventory into cash quickly. Conversely, a longer cash conversion cycle may indicate inefficiencies in inventory management, collection of receivables, or payment of payables.

It is important for Cognex Corporation to closely monitor and manage its cash conversion cycle to ensure optimal utilization of working capital and liquidity. Analyzing the components of the cash conversion cycle, including days inventory outstanding, days sales outstanding, and days payable outstanding, can provide insights into where improvements can be made to streamline operations and enhance cash flow efficiency.