Cohu Inc (COHU)
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 | 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 | 2.95 | 3.10 | 3.01 | 3.22 |
| Quick ratio | 3.25 | 3.02 | 2.69 | 2.24 | 2.40 | 2.16 | 1.89 | 2.03 | 1.97 | 1.80 | 1.35 | 1.40 | 0.97 | 1.16 | 1.03 | 1.05 | 1.05 | 1.04 | 0.98 | 1.16 |
| Cash ratio | 3.25 | 3.02 | 2.69 | 2.24 | 2.40 | 2.16 | 1.89 | 2.03 | 1.97 | 1.80 | 1.35 | 1.40 | 0.97 | 1.16 | 1.03 | 1.05 | 1.05 | 1.05 | 0.98 | 1.16 |
Cohu Inc's liquidity ratios have shown a generally positive trend over the past few quarters. The current ratio has been consistently above 3 in recent quarters, indicating that the company has more than enough current assets to cover its current liabilities. This ratio increased from 3.22 in Q1 2019 to 6.18 in Q4 2023, showcasing a strong improvement in the company's ability to meet its short-term obligations.
The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has also been steadily increasing over the same period. This suggests that Cohu Inc has a strong ability to meet its short-term liabilities even without relying on selling inventory. The quick ratio increased from 1.16 in Q1 2020 to 3.25 in Q4 2023.
The cash ratio, which is the most conservative measure of liquidity, has also shown a positive trend. This ratio improved from 0.98 in Q3 2019 to 3.25 in Q4 2023. The increasing cash ratio indicates that Cohu Inc has a higher level of readily available cash to cover its current liabilities, which is a positive sign for the company's financial health and ability to weather any short-term financial challenges.
Overall, Cohu Inc's liquidity ratios demonstrate a strong and improving financial position in terms of its ability to meet short-term obligations. The increasing trend in all three liquidity ratios reflects prudent management of working capital and liquidity resources, which bodes well for the company's financial stability and operational efficiency.
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 | 98.28 | 94.54 | 89.62 | 82.06 | 72.65 | 60.24 | 49.26 | 42.76 | 41.64 | 39.82 | 31.74 | 41.72 | 52.74 | 65.53 | 62.39 | 59.79 | 59.55 | 56.42 | 61.00 | 71.30 |
The cash conversion cycle of Cohu Inc has shown some fluctuations over the periods under consideration. The cash conversion cycle represents the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales and ultimately back into cash through the collection of receivables.
From Dec 31, 2019, to Dec 31, 2023, Cohu Inc's cash conversion cycle has ranged from a low of 31.74 days to a high of 98.28 days. Generally, a shorter cash conversion cycle indicates that the company is efficiently managing its working capital, while a longer cycle may suggest inefficiencies in operations.
It's worth noting that there was a significant increase in the cash conversion cycle from Mar 31, 2021, to Dec 31, 2021, which peaked at 71.3 days. However, Cohu Inc managed to improve its efficiency by reducing the cycle to 31.74 days by the end of Dec 31, 2021.
Overall, Cohu Inc should focus on strategies to continue optimizing its cash conversion cycle to ensure effective management of its working capital and maintain healthy cash flows. Tracking this metric regularly can help the company identify areas for improvement in its operational efficiency.