The Cooper Companies Inc. (COO)

The current ratio measures a company's ability to meet its short-term obligations with its current assets. Cooper Companies, Inc.'s current ratio has shown fluctuation over the past five years, ranging from a low of 1.05 to a high of 2.00. The ratio improved significantly in 2023, standing at 1.76, indicating a stronger ability to cover its short-term liabilities with current assets.

Similarly, the quick ratio, which provides a more stringent measure of liquidity by excluding inventories from current assets, also exhibited variability over the years. In 2023, the quick ratio reached 1.00, reflecting a considerable improvement compared to the previous years.

The cash ratio, which measures a company's ability to cover its short-term obligations with cash and cash equivalents, also demonstrated an upward trend in 2023, reaching 0.37. This suggests an enhanced capacity to meet short-term liabilities with readily available cash, further enhancing Cooper Companies, Inc.'s liquidity position.

Overall, Cooper Companies, Inc.'s liquidity ratios have shown improvement in 2023, indicating a stronger ability to meet its short-term obligations and suggesting a more stable financial position in the short term.

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Additional liquidity measure

The cash conversion cycle of Cooper Companies, Inc. has shown some fluctuations over the past five years. In 2023, the cash conversion cycle increased to 201.90 days from 180.18 days in 2022. This suggests that Cooper Companies, Inc. took longer to convert its resource inputs into cash during the most recent year. This could be an indication of inefficiencies in inventory management, accounts receivable collection, or accounts payable management.

Comparing the most recent data to 2021, there was a decrease in the cash conversion cycle from 224.52 days to 201.90 days. This shows an improvement in the efficiency of the company's working capital management, indicating a shorter period to convert its resources into cash, which can be a positive sign for the company's financial performance.

However, when compared to 2020 and 2019, the cash conversion cycle remained relatively consistent, with minor fluctuations. Generally, lower cash conversion cycles are more favorable as they indicate that the company is able to quickly convert its investments in inventory and other resources into cash, thereby improving its liquidity and overall financial health. It is important for Cooper Companies, Inc. to continue monitoring and improving its cash conversion cycle to ensure efficient working capital management.