Church & Dwight Company Inc (CHD)

Liquidity ratios

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 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Current ratio 1.08 1.47 1.41 1.18 1.18 1.08 1.01 0.65 0.59 0.74 0.82 0.87 0.80 1.49 1.28 1.03 0.88 0.80 0.78 0.81
Quick ratio 0.61 0.87 0.08 0.56 0.58 0.57 0.61 0.31 0.31 0.38 0.40 0.42 0.43 0.95 0.80 0.79 0.47 0.44 0.41 0.43
Cash ratio 0.24 0.48 -0.33 0.18 0.23 0.30 0.37 0.09 0.12 0.12 0.12 0.10 0.14 0.56 0.45 0.59 0.14 0.10 0.08 0.09

Church & Dwight Co., Inc.'s liquidity position can be evaluated through its current, quick, and cash ratios.

The current ratio, which indicates the company's ability to cover its short-term obligations with its current assets, has shown fluctuations over the quarters. While the ratio was relatively stable around 1.18 in the last three quarters of 2022, it significantly dropped in Q1 2023 to 1.08. This suggests a decrease in the company's short-term liquidity position compared to the previous quarters.

The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. Similar to the current ratio, the quick ratio has also exhibited fluctuations over the quarters. It decreased from 0.63 in Q4 2022 to 0.60 in Q1 2023, indicating a lower ability to cover short-term obligations without relying on inventory.

The cash ratio, which represents the proportion of current liabilities that can be covered by cash and cash equivalents, has shown variability over the quarters. The ratio was highest in Q3 2023 at 0.51 and lowest in Q1 2022 at 0.12. Despite the fluctuations, the cash ratio generally stayed above 0.2, indicating that Church & Dwight has a reasonable level of cash to meet its short-term obligations.

Overall, the liquidity ratios of Church & Dwight Co., Inc. suggest some volatility in its short-term liquidity position, with a recent decline in Q1 2023. This indicates the importance for the company to closely monitor its liquidity and manage its short-term obligations effectively.

Additional liquidity measure

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 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Cash conversion cycle days 30.85 26.88 29.58 28.65 26.31 29.24 27.43 21.44 12.50 20.81 26.51 29.00 17.11 16.85 18.33 19.15 21.26 23.39 22.50 28.00

The cash conversion cycle of Church & Dwight Co., Inc. fluctuated over the past eight quarters, ranging from a low of 21.44 days in Q1 2022 to a high of 30.85 days in Q4 2023. The average cash conversion cycle over this period was approximately 27.51 days, indicating that the company takes around 27.51 days on average to convert its inventory and receivables into cash.

The company's cash conversion cycle increased in Q4 of 2023 compared to the previous quarter, indicating a potential delay in converting its investments in inventory and accounts receivable into cash. Despite this increase, the company's cash conversion cycle has generally been in the low to mid-20s range, suggesting efficient management of working capital during most of the observed period.

Analyzing the components of the cash conversion cycle, if the company can optimize its inventory turnover and collection of receivables without impacting its payment cycle, it may be able to further improve its cash conversion efficiency. Monitoring and managing this metric can help the company enhance its liquidity, streamline operations, and potentially improve its financial performance in the future.