Dycom Industries Inc (DY)

Dycom Industries, Inc.'s liquidity ratios show a relatively strong liquidity position over the past five years. The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, has remained above 2 in all years, indicating that Dycom has ample current assets to meet its short-term liabilities. The current ratio has fluctuated slightly over the years but has generally stayed above 3, reflecting a healthy liquidity position.

Similarly, the quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has also demonstrated a stable and strong liquidity position for Dycom. The quick ratio has consistently been above 2, reflecting the company's ability to cover its short-term liabilities with its most liquid assets.

The cash ratio, which measures the company's ability to cover its current liabilities with its cash and cash equivalents, has shown some variability over the years but has generally been above 0.5, indicating that Dycom has a moderate level of cash to meet its short-term obligations.

Overall, Dycom Industries, Inc. has maintained a solid liquidity position based on its current, quick, and cash ratios over the past five years. The company has demonstrated a strong ability to meet its short-term obligations and operational needs with its liquid assets.

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Additional liquidity measure

The cash conversion cycle of Dycom Industries, Inc. has shown some variability over the last five years. In the most recent fiscal year, ending on January 27, 2024, the cash conversion cycle increased to 96.35 days compared to the previous year's 91.55 days. This indicates that it took the company longer to convert its investments in inventory and receivables into cash during the most recent period.

Looking back at the trend over the past five years, we observe fluctuations in the cash conversion cycle. However, despite the variations, it has generally remained within a relatively narrow range, suggesting a certain level of stability in Dycom Industries' working capital management practices.

The cash conversion cycle measures the time it takes for a company to convert its resources invested in inventory and accounts receivable into cash inflows. A longer cash conversion cycle can indicate inefficiencies in working capital management, which may lead to increased financing costs or liquidity challenges for the company.

Therefore, Dycom Industries, Inc. may benefit from evaluating its inventory and accounts receivable management processes to optimize its cash conversion cycle and enhance overall financial performance.