DXP Enterprises Inc (DXPE)

Liquidity ratios

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 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Current ratio 2.89 2.33 2.45 2.40 2.42 1.93 1.91 2.32 2.23 2.18 2.15 2.72 2.78 2.58 2.70 2.79 2.94 2.71 2.56 2.48
Quick ratio 2.16 1.57 1.64 1.65 1.74 1.22 1.24 1.49 1.53 1.48 1.48 1.92 0.75 1.64 1.57 1.57 1.74 1.58 1.49 1.44
Cash ratio 0.77 0.12 0.07 0.26 0.22 0.07 0.09 0.21 0.27 0.33 0.42 0.81 0.81 0.62 0.53 0.23 0.39 0.19 0.16 0.19

Based on the provided data, DXP Enterprises Inc's liquidity ratios have shown some fluctuations over the periods analyzed.

The current ratio, which measures the company's ability to pay its short-term obligations with its current assets, has generally been above 2.0 in most periods, indicating a healthy liquidity position. However, there have been some fluctuations, with the ratio reaching as high as 2.89 in the most recent period (Dec 31, 2023) and dropping to 1.91 in Jun 30, 2022. Overall, the current ratio has shown a generally positive trend over time.

The quick ratio, a more conservative measure of liquidity that excludes inventory from current assets, also reflects DXP Enterprises Inc's ability to meet short-term obligations. The ratio has experienced fluctuations, with values ranging from 0.75 to 2.16. The company appears to have improved its quick ratio significantly in some periods, especially compared to Sep 30, 2020, where the ratio was only 0.75.

The cash ratio, which is the most conservative liquidity measure focusing solely on cash and cash equivalents, indicates the company's immediate ability to cover its current liabilities. DXP Enterprises Inc's cash ratio has varied considerably from 0.07 to 0.81 over the periods analyzed. The company had notably higher cash ratios in some recent periods like Mar 31, 2021 and Dec 31, 2020.

In general, while there have been fluctuations in DXP Enterprises Inc's liquidity ratios, the company appears to have maintained a reasonable level of liquidity to cover its short-term obligations over the periods analyzed. The management should continue monitoring these ratios to ensure a healthy liquidity position moving forward.

Additional liquidity measure

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 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Cash conversion cycle days 71.62 72.81 76.85 74.30 81.46 86.45 84.78 81.36 83.80 125.78 169.67 272.08 108.74 67.38 64.62 72.55 70.81 75.62 73.44 67.83

The cash conversion cycle of DXP Enterprises Inc has shown fluctuations over the past five years, ranging from a low of 64.62 days to a high of 272.08 days. The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash inflows from sales.

In general, a shorter cash conversion cycle indicates that the company is more efficient in managing its working capital and turning its inventory into sales and cash quickly. On the other hand, a longer cash conversion cycle may indicate inefficiencies in managing inventory levels, collecting receivables, or paying suppliers.

Looking at the trend over the past few quarters, the cash conversion cycle seems to have improved recently, with a decrease from 169.67 days in June 2021 to 71.62 days in December 2023. This improvement suggests that DXP Enterprises Inc has become more efficient in managing its working capital and converting its assets into cash.

It is important for investors and stakeholders to monitor the cash conversion cycle as it can provide insights into the company's liquidity, operational efficiency, and overall financial health.