Carter’s Inc (CRI)

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 2.25 2.21 2.09 2.43 2.15 2.30 2.02 2.54 2.25 2.44 2.12 1.66 2.65 2.94 3.14 2.92 2.46 2.36 2.69 3.72
Quick ratio 1.19 0.87 0.85 1.17 1.05 0.88 0.59 0.93 0.78 0.70 0.66 0.94 1.69 1.79 2.04 1.97 1.63 1.44 1.66 2.29
Cash ratio 0.81 0.36 0.60 0.64 0.69 0.36 0.34 0.38 0.40 0.22 0.36 0.69 1.37 1.40 1.78 1.60 1.39 1.09 1.42 1.77

Carter’s Inc has exhibited varying levels of liquidity over the past few years based on its liquidity ratios. The current ratio, which indicates the company's ability to cover its short-term obligations with its current assets, showed a general downward trend from a high of 3.72 in March 2020 to a low of 1.66 in March 2022 before recovering slightly to 2.25 by December 2024. This suggests a decrease in the company's short-term liquidity position during the analyzed period.

The quick ratio, a more conservative measure of liquidity that excludes inventory from current assets, followed a similar pattern, with a decline from 2.29 in March 2020 to a low of 0.59 in June 30, 2023, before rebounding to 1.19 by December 31, 2024. This indicates that the company's ability to meet its short-term obligations with its most liquid assets also experienced fluctuations over the period.

Lastly, the cash ratio, which provides the most stringent measure of liquidity by considering only cash and cash equivalents, demonstrated a notable decrease from 1.77 in March 2020 to 0.22 in September 30, 2022, before improving to 0.81 by December 31, 2024. This suggests that Carter’s Inc had a decreasing ability to cover its short-term liabilities with its cash reserves during the analyzed period.

Overall, while the company's liquidity ratios have shown variability, with periods of improvement alternating with declines, it is essential for Carter’s Inc to maintain a strong liquidity position to ensure it can meet its obligations in a timely manner and withstand any unforeseen financial challenges.

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 135.65 204.06 160.83 163.39 165.94 248.25 226.22 235.08 254.42 132.20 121.14 142.91 93.73 161.04 104.52 101.31 59.57 65.80 60.87 93.25

The cash conversion cycle of Carter’s Inc has exhibited fluctuations over the quarters from March 2020 to December 2024. The cash conversion cycle represents the time taken to convert inventory into cash, reflecting the efficiency of the company's working capital management.

The trend in Carter’s Inc's cash conversion cycle suggests varying efficiency in managing its working capital during different periods. For instance, the company experienced a significant increase in its cash conversion cycle from September 2021 to December 2022, indicating potential challenges in converting inventory into cash efficiently during that time.

However, the company managed to reduce its cash conversion cycle from December 2022 to June 2024, which could signify improvements in inventory management and collection of receivables. The decrease in the cash conversion cycle over these periods may indicate enhanced operational efficiency and a better utilization of working capital.

Overall, fluctuations in the cash conversion cycle of Carter’s Inc demonstrate the company's ability to adapt to changing market conditions and manage its working capital effectively to enhance liquidity and financial performance. Monitoring this ratio can provide insights into the company's operational efficiency and working capital management strategies.