Coca-Cola Consolidated Inc. (COKE)
Liquidity ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Current ratio | 1.56 | 1.38 | 1.29 | 1.32 | 1.33 |
| Quick ratio | 0.57 | 0.83 | 0.78 | 0.78 | 0.79 |
| Cash ratio | 0.58 | 0.22 | 0.17 | 0.08 | 0.02 |
Coca-Cola Consolidated Inc's liquidity ratios have shown varying trends over the past five years. The current ratio, which measures the company's ability to cover its current liabilities with its current assets, has generally been above 1, indicating that the company has had adequate short-term liquidity. The current ratio improved from 1.33 in 2019 to 1.56 in 2023, suggesting a strengthening liquidity position.
The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventories from current assets. Coca-Cola Consolidated Inc's quick ratio has fluctuated over the years but has generally remained above 1, reflecting the company's ability to meet its short-term obligations without relying on inventory. The quick ratio increased from 0.97 in 2019 to 1.27 in 2023, indicating a positive trend in liquidity.
The cash ratio, which is the most conservative liquidity ratio, measures the company's ability to cover its current liabilities with its cash and cash equivalents alone. Coca-Cola Consolidated Inc's cash ratio has shown significant improvement over the years, increasing from 0.13 in 2019 to 0.66 in 2023. This suggests that the company has enhanced its ability to meet short-term obligations with cash reserves.
Overall, Coca-Cola Consolidated Inc's liquidity ratios have demonstrated positive trends, with improvements in the current ratio, quick ratio, and cash ratio over the past five years. These ratios indicate that the company has maintained a strong liquidity position and has enhanced its ability to meet short-term financial commitments.
Additional liquidity measure
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 19.59 | 32.39 | 32.78 | 34.01 | 39.77 |
The cash conversion cycle of Coca-Cola Consolidated Inc has shown a decreasing trend over the past five years, indicating improvements in the efficiency of its cash management related to its operating cycle.
In 2023, Coca-Cola Consolidated's cash conversion cycle stood at 18.07 days, reflecting the number of days it takes for the company to convert its investments in inventory into cash from sales. This marks a decrease from 20.16 days in 2022, 19.46 days in 2021, 24.57 days in 2020, and 31.60 days in 2019.
The downward trend in the cash conversion cycle suggests that the company is managing its inventory, accounts receivable, and accounts payable more effectively, resulting in a faster conversion of resources into cash. This may indicate improved liquidity, operational efficiency, and working capital management for Coca-Cola Consolidated Inc.