PC Connection Inc (CNXN)

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 3.20 3.06 2.94 3.06 3.07 2.79 2.66 2.57 2.49 2.94 2.66 2.92 2.51 2.49 2.57 2.70 2.51 2.76 2.35 2.60
Quick ratio 2.93 2.60 2.43 2.38 2.55 2.16 2.01 1.90 2.04 2.30 2.11 2.35 2.26 2.06 1.99 2.16 2.25 2.24 1.78 2.04
Cash ratio 0.91 0.85 0.70 0.42 0.40 0.33 0.26 0.18 0.29 0.31 0.35 0.34 0.28 0.32 0.54 0.40 0.29 0.38 0.22 0.36

The liquidity ratios of PC Connection, Inc. have generally shown positive trends over the past eight quarters. The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, has been consistently above 2.5, indicating a strong liquidity position. The current ratio improved from 3.07 in Q4 2022 to 3.20 in Q4 2023, suggesting an increase in current assets relative to current liabilities.

The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, also reflects a favorable liquidity position for PC Connection, Inc. The quick ratio increased from 2.40 in Q4 2022 to 2.82 in Q4 2023, indicating an improvement in the company's ability to meet short-term obligations without relying on inventory.

Furthermore, the cash ratio, which focuses solely on the most liquid assets (cash and cash equivalents) compared to current liabilities, shows a steady increase in PC Connection, Inc.'s ability to cover its short-term obligations with cash. The cash ratio rose from 0.43 in Q4 2022 to 0.96 in Q4 2023, signaling a significant enhancement in the company's cash position.

Overall, the liquidity ratios of PC Connection, Inc. demonstrate a strong financial position with improving liquidity levels over the past year, indicating the company's ability to meet its short-term financial obligations efficiently.

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 66.57 59.29 59.08 69.19 75.10 68.56 67.58 71.47 72.88 71.53 66.75 70.69 77.29 60.52 48.89 50.44 63.55 52.50 55.10 48.94

The cash conversion cycle for PC Connection, Inc. has been relatively stable over the past eight quarters, ranging from 56.49 days to 70.77 days. A lower cash conversion cycle indicates that the company is efficient in managing its working capital.

In Q1 2023, the cash conversion cycle increased to 68.37 days compared to the previous quarter, reflecting a potential delay in converting inventory into sales and accounts receivable into cash. This increase in the cash conversion cycle may imply a longer operating cycle or slower collection of receivables during that period.

However, the company managed to lower the cash conversion cycle to 56.49 days in Q4 2023, indicating an improvement in working capital management efficiency. It is important for PC Connection, Inc. to closely monitor and analyze its cash conversion cycle to optimize working capital and improve overall financial performance.