The Chefs Warehouse Inc (CHEF)
Liquidity ratios
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 23, 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 | 1.89 | 2.06 | 2.14 | 2.29 | 2.54 | 2.50 | 2.07 | 2.26 | 2.39 | 2.48 | 2.50 | 3.07 | 3.43 | 3.25 | 3.54 | 3.23 | 3.02 | 2.35 | 2.28 | 2.31 |
| Quick ratio | 1.00 | 1.06 | 1.15 | 1.20 | 1.48 | 1.50 | 1.13 | 1.28 | 1.46 | 1.55 | 1.61 | 2.11 | 2.45 | 2.29 | 2.52 | 2.22 | 2.10 | 1.34 | 1.31 | 1.33 |
| Cash ratio | 0.13 | 0.09 | 0.18 | 0.30 | 0.56 | 0.61 | 0.22 | 0.41 | 0.58 | 0.73 | 0.84 | 1.35 | 1.64 | 1.54 | 1.66 | 1.27 | 0.93 | 0.16 | 0.17 | 0.14 |
The liquidity ratios of The Chefs Warehouse Inc show a consistent overall trend of strong liquidity position over the past few years.
The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, has generally remained above 2x, indicating a healthy liquidity position. This ratio has shown a slight decline over recent quarters, but still remains at a healthy level.
The quick ratio, a more stringent measure of liquidity excluding inventory from current assets, has also been consistently strong, with values well above 1x. This indicates that the company has a sufficient level of liquid assets to cover its short-term liabilities without relying on inventory.
The cash ratio, which evaluates the company's ability to cover its current liabilities with its cash and cash equivalents, has displayed a decreasing trend from higher levels to lower values, but still remaining above 1x in recent quarters. This suggests the company has a strong ability to meet its immediate obligations with readily available cash.
Overall, The Chefs Warehouse Inc's liquidity ratios indicate that the company has a sound financial position with adequate liquidity to meet its short-term obligations comfortably.
Additional liquidity measure
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 23, 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 | 45.10 | 50.31 | 50.95 | 50.31 | 48.99 | 39.87 | 41.04 | 37.38 | 41.88 | 45.12 | 45.89 | 46.99 | 44.39 | 38.07 | 39.97 | 44.19 | 49.60 | 51.70 | 49.15 | 49.06 |
The cash conversion cycle of The Chefs Warehouse Inc shows fluctuations over the periods analyzed. The company's cash conversion cycle ranged from a low of 37.38 days to a high of 51.70 days. A shorter cash conversion cycle indicates that the company is efficiently managing its working capital and converting inventory into cash quickly. On the other hand, a longer cash conversion cycle may imply inefficiencies in managing receivables, payables, and inventory.
The trend in the cash conversion cycle indicates that the company's efficiency in managing working capital has varied over time. Fluctuations in the cash conversion cycle could be due to changes in the company's sales cycles, inventory management practices, or payment terms with suppliers and customers. The company should closely monitor its cash conversion cycle to identify areas for improvement and optimize its working capital management.
Overall, The Chefs Warehouse Inc should aim to maintain a balanced cash conversion cycle to ensure efficient use of resources and maximize cash flow. By analyzing trends and identifying areas of inefficiency, the company can take proactive steps to enhance its working capital management and ultimately improve its financial performance.