Cohu Inc (COHU)

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 6.27 6.38 6.95 6.29 6.18 5.59 5.22 4.89 4.75 4.39 3.95 4.26 3.90 3.68 2.57 3.25 2.78 3.03 2.87 2.77
Quick ratio 3.08 3.17 3.34 2.98 3.25 3.02 3.39 2.24 2.40 2.16 1.89 2.03 1.97 1.80 1.60 1.40 0.97 1.16 1.03 1.05
Cash ratio 3.08 3.17 3.34 2.98 3.25 3.02 3.39 2.24 2.40 2.16 1.89 2.03 1.97 1.80 1.60 1.40 0.97 1.16 1.03 1.05

Cohu Inc's liquidity ratios have shown a consistent improvement over the years.

1. Current Ratio: The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, has increased steadily from 2.77 as of March 31, 2020, to 6.27 as of December 31, 2024. This indicates that Cohu Inc has a strong ability to meet its short-term liabilities with its current assets, and the ratio has improved to a very healthy level by the end of 2024.

2. Quick Ratio: The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventories from current assets. Cohu Inc's quick ratio has also shown improvement over the years, increasing from 1.05 as of March 31, 2020, to 3.08 as of December 31, 2024. This reveals that the company has a very strong ability to meet its short-term obligations without relying on inventory liquidation.

3. Cash Ratio: The cash ratio, which is the most conservative liquidity ratio, measures a company's ability to cover its short-term liabilities with its cash and cash equivalents alone. Cohu Inc's cash ratio has shown a significant increase from 1.05 as of March 31, 2020, to 3.08 as of December 31, 2024. This indicates that the company has a very strong cash position relative to its short-term liabilities, reflecting a sound financial health in terms of liquid assets.

Overall, the liquidity ratios of Cohu Inc paint a positive picture, showing a consistent improvement in the company's ability to meet its short-term obligations with various levels of liquidity as reflected in current assets, quick assets, and cash equivalents.

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 206.41 188.92 179.01 173.50 165.36 169.18 163.33 151.55 141.85 134.84 126.86 121.04 117.51 114.09 123.21 145.10 142.80 147.56 152.93 143.53

The cash conversion cycle of Cohu Inc has shown fluctuations over the observed periods. The cycle started at 143.53 days on March 31, 2020, increased to 152.93 days by June 30, 2020, and then decreased to 142.80 days by December 31, 2020. The trend continued with a slight increase to 145.10 days by March 31, 2021, before experiencing a significant improvement to 114.09 days on September 30, 2021. This trend continued positively with further improvements to 117.51 days by December 31, 2021, and 121.04 days by March 31, 2022.

However, the cash conversion cycle increased again to 163.33 days by June 30, 2023, and further to 206.41 days by December 31, 2024. These longer cycles signify potential challenges in managing liquidity and efficiently converting inventory and receivables into cash.

It is important for Cohu Inc to closely monitor its cash conversion cycle to ensure optimal cash flow management, efficient working capital utilization, and timely collections to support its operations and growth strategies. Management may need to assess the underlying factors contributing to the lengthening of the cycle during certain periods to implement appropriate measures for improvement.