Commercial Metals Company (CMC)
Liquidity ratios
| Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | May 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 4.19 | 4.12 | 3.73 | 3.68 | 3.07 | 2.99 | 2.54 | 2.48 | 4.23 | 3.12 | 2.79 | 2.95 | 3.27 | 3.54 | 2.97 | 3.42 | 3.21 | 3.35 | 2.99 | 3.00 |
| Quick ratio | 2.30 | 3.02 | 2.17 | 2.02 | 1.75 | 1.73 | 1.50 | 1.25 | 2.42 | 1.69 | 1.64 | 1.78 | 1.87 | 2.18 | 1.91 | 2.14 | 1.84 | 1.97 | 1.74 | 1.61 |
| Cash ratio | 0.84 | 1.47 | 0.70 | 0.56 | 0.57 | 0.54 | 0.50 | 0.30 | 1.03 | 0.47 | 0.51 | 0.52 | 0.54 | 0.76 | 0.73 | 0.74 | 0.36 | 0.37 | 0.28 | 0.17 |
Commercial Metals Company has displayed strong liquidity levels over the past few quarters based on its liquidity ratios. The current ratio has consistently remained above 2, reflecting the company's ability to meet its short-term obligations with ease. The upward trend in the current ratio indicates improving liquidity.
The quick ratio, which excludes inventory from current assets, also exhibited healthy values above 1 in most periods. This suggests that the company has an adequate level of liquid assets to cover its immediate liabilities. However, there was some volatility in the quick ratio over the observed periods.
The cash ratio, which is the most conservative measure of liquidity, has generally shown an upward trend, indicating an increasing ability to cover short-term obligations with cash alone. Commercial Metals Company has significantly improved its cash reserves relative to its current liabilities.
Overall, the liquidity ratios suggest that Commercial Metals Company has maintained a strong financial position in terms of liquidity, with sufficient resources to meet its short-term obligations and potential operating needs.
Additional liquidity measure
| Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | May 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 100.53 | 96.86 | 94.80 | 85.19 | 82.80 | 83.28 | 89.90 | 99.49 | 92.20 | 91.14 | 89.43 | 96.59 | 91.67 | 86.94 | 84.97 | 87.05 | 89.83 | 86.45 | 91.08 | 103.26 |
The Cash Conversion Cycle (CCC) of Commercial Metals Company has shown some variability over the past several periods. The CCC measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
From the data provided, we can observe that the company's CCC has fluctuated between a low of 82.80 days to a high of 103.26 days. A lower CCC indicates that the company is able to efficiently manage its working capital and convert its assets into cash quickly, while a higher CCC suggests that the company may be facing challenges in managing its cash flow and working capital effectively.
Overall, the company's CCC has generally ranged between 85 to 100 days, indicating that Commercial Metals Company has been efficient in managing its cash conversion cycle during these periods. However, it is important for the company to continue monitoring and optimizing its working capital management to ensure continued efficiency in converting investments into cash flows.