Coca-Cola Consolidated Inc. (COKE)

Based on the provided data for Coca-Cola Consolidated Inc., let's analyze the liquidity ratios:

1. Current Ratio: The current ratio measures the company's ability to meet its short-term obligations with its current assets. In the case of Coca-Cola Consolidated Inc., the current ratio has shown a fluctuating trend over the years. It decreased from 1.32 in 2020 to 1.29 in 2021, then increased steadily to 1.94 by 2024. A current ratio above 1 indicates that the company has more current assets than current liabilities, which is generally a positive sign for liquidity.

2. Quick Ratio: The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity as it excludes inventory from current assets. Coca-Cola Consolidated Inc.'s quick ratio has also shown a fluctuating trend over the years, starting at a low of 0.08 in 2020 and increasing significantly to 1.09 by 2024. An increasing quick ratio indicates an improvement in the company's ability to meet its short-term obligations without relying on inventory.

3. Cash Ratio: The cash ratio is the most conservative liquidity ratio as it measures the company's ability to cover its short-term liabilities with cash and cash equivalents only. Coca-Cola Consolidated Inc.'s cash ratio has followed a similar trend to the quick ratio, starting at 0.08 in 2020 and reaching 1.09 by 2024. A cash ratio of 1.09 in 2024 means that the company had enough cash on hand to cover its current liabilities, which is a positive indicator of liquidity.

Overall, based on the analysis of these liquidity ratios, Coca-Cola Consolidated Inc. has shown improvements in its liquidity position over the years, with increasing current, quick, and cash ratios. This indicates that the company has been able to enhance its ability to meet its short-term obligations and manage liquidity effectively.

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Additional liquidity measure

Coca-Cola Consolidated Inc.'s cash conversion cycle has exhibited some variability over the past five years. As of December 31, 2020, the company's cash conversion cycle stood at 25.44 days. It increased to 30.63 days by December 31, 2021, indicating a longer period for the company to convert its investments in inventory into cash receipts from customers.

By December 31, 2022, the cash conversion cycle further extended to 32.34 days, suggesting a potential slowdown in the company's cash conversion efficiency. However, there was a slight improvement by December 31, 2023, with the cycle decreasing to 28.98 days, hinting at a more effective management of working capital during that period.

Continuing the positive trend, by December 31, 2024, the cash conversion cycle remained relatively stable at 29.08 days. Overall, the fluctuations in the cash conversion cycle indicate that Coca-Cola Consolidated Inc. has experienced varying levels of efficiency in managing its working capital and converting assets into cash over the specified period.