Delta Air Lines Inc (DAL)

Delta Air Lines, Inc.'s liquidity ratios have shown a declining trend over the past five years. The current ratio, which indicates the company's ability to cover short-term obligations with its current assets, decreased from 1.09 in 2020 to 0.39 in 2023. This suggests that Delta's current assets may not be sufficient to meet its current liabilities.

Similarly, the quick ratio, a more conservative measure of liquidity that excludes inventory from current assets, also decreased from 1.05 in 2021 to 0.34 in 2023. This indicates that Delta may have difficulty meeting its short-term obligations without relying on inventory.

The cash ratio, which measures the company's ability to cover its current liabilities with cash and cash equivalents, also declined from 0.96 in 2021 to 0.22 in 2023. This suggests that Delta has a lower level of cash relative to its current liabilities.

Overall, the decreasing trend in Delta Air Lines, Inc.'s liquidity ratios indicates a potential liquidity challenge for the company. It may face difficulty in meeting its short-term obligations without resorting to additional financing or improving its cash reserves.

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See also:

Delta Air Lines Inc Liquidity Ratios

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Additional liquidity measure

The cash conversion cycle of Delta Air Lines, Inc. has shown fluctuations over the past five years. In 2023, the company's cash conversion cycle decreased to 19.68 days from 22.92 days in 2022, indicating an improvement in its cash management efficiency. This suggests that Delta has been able to convert its investments in inventory and accounts receivable into cash more quickly in 2023.

Comparing to the prior years, in 2021 and 2020, the cash conversion cycle was relatively higher at 29.35 days and 29.81 days, respectively. This indicates that the company took longer to convert its investments into cash during these years, possibly facing challenges in managing working capital efficiently.

The lowest cash conversion cycle in the past five years was recorded in 2019 at 22.16 days, which suggests that the company was more effective in managing its cash flow and working capital during that year compared to the other years analyzed.

Overall, the trend in Delta Air Lines' cash conversion cycle indicates fluctuations in the efficiency of its cash management over the past five years, with improvements in some years and challenges in others. The company may need to continue monitoring and optimizing its working capital management practices to ensure effective cash conversion in the future.