Embecta Corp (EMBC)

Liquidity ratios

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
Current ratio 2.03 2.11 2.29 2.20 2.12 2.04 2.11 2.06 2.21 2.54 2.53 1.62
Quick ratio 1.38 1.40 1.50 1.55 1.37 1.32 1.40 1.43 1.54 1.80 1.65 0.74
Cash ratio 0.72 0.74 0.97 0.91 0.92 0.82 0.97 1.04 1.10 1.28 1.56 0.00

The liquidity ratios of Embecta Corp have shown consistent improvement over the recent quarters. The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, has been relatively stable between 2.03 and 2.54. This indicates a healthy level of liquidity, with the company having more than enough current assets to cover its short-term obligations.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has also shown a positive trend, ranging from 1.32 to 1.80. This suggests that Embecta Corp has a strong ability to meet its short-term liabilities using only its most liquid assets.

Furthermore, the cash ratio, which provides an even stricter assessment of liquidity by focusing solely on cash and cash equivalents, has been relatively stable between 0.72 and 1.56. This indicates that the company has maintained a sufficient level of cash reserves to cover its immediate financial obligations.

Overall, the liquidity ratios of Embecta Corp demonstrate a healthy financial position with a strong ability to meet its short-term obligations. The consistent improvement in these ratios reflects the company's effective management of liquidity and its ability to adapt to changing market conditions.


Additional liquidity measure

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
Cash conversion cycle days 98.75 112.31 83.55 91.62 64.92 109.35 82.75 88.72 65.34

The cash conversion cycle is a key performance metric that measures the time it takes for a company to convert its investments in raw materials into cash received from sales. Embecta Corp's cash conversion cycle has fluctuated over the past nine quarters, ranging from a low of 64.92 days to a high of 112.31 days.

In the most recent quarter ending on September 30, 2024, the company's cash conversion cycle was 98.75 days. This indicates that on average, it takes Embecta Corp approximately 98.75 days to convert its investments in inventory into cash received from customers.

Analyzing the trend over the past quarters, we observe a peak in the cycle on June 30, 2024, at 112.31 days, suggesting a longer time to convert inventory to cash during that period. Conversely, the cycle improved significantly on September 30, 2023, at 64.92 days, indicating a more efficient conversion process.

Overall, fluctuating cash conversion cycles can reveal insights into a company's operational efficiency, inventory management, and collection practices. It is important for Embecta Corp to monitor and potentially improve its cash conversion cycle to optimize working capital management and overall financial performance.