Eastman Chemical Company (EMN)

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	1.35	1.36	1.32	1.34	1.16	1.28	1.27	1.57	1.56	1.57	2.06	1.88	1.74	1.98	1.88	1.66	1.86	1.65	1.58	1.51
Quick ratio	0.56	0.51	0.48	0.56	0.46	0.50	0.53	0.53	0.58	0.67	0.83	0.88	0.94	0.97	0.86	0.75	0.78	0.67	0.64	0.63
Cash ratio	0.21	0.17	0.15	0.20	0.15	0.14	0.14	0.16	0.15	0.23	0.27	0.27	0.28	0.36	0.37	0.29	0.11	0.10	0.08	0.08

Based on the data provided for Eastman Chemical Co's liquidity ratios, we can observe the following trends:

1. Current Ratio:
- The current ratio has been relatively stable over the past few quarters, ranging from 1.32 to 1.36.
- A current ratio above 1 indicates that the company has more current assets than current liabilities, which suggests a good ability to meet short-term obligations.
- However, it is important to note that the current ratio decreased from 1.57 in Q1 2022 to 1.34 in Q1 2023, indicating a slight decline in short-term liquidity.

2. Quick Ratio:
- The quick ratio has shown fluctuations, ranging from 0.61 to 0.71.
- The quick ratio measures the company's ability to meet short-term obligations with its most liquid assets.
- A quick ratio below 1 may indicate potential issues in meeting immediate short-term obligations, and the downward trend from Q2 2022 to Q3 2023 warrants attention.

3. Cash Ratio:
- The cash ratio reflects the company's ability to cover its current liabilities with its cash and cash equivalents.
- Eastman Chemical Co's cash ratio has varied between 0.17 and 0.25.
- A cash ratio below 0.20 may suggest limited ability to cover short-term obligations solely with cash on hand, although the company's ratio has generally remained within a reasonable range.

In summary, while Eastman Chemical Co has maintained a current ratio above 1, indicating overall good liquidity in the short-term, the decreasing trend in the quick ratio and fluctuations in the cash ratio suggest a need for careful monitoring of the company's ability to meet immediate financial obligations with its available liquid resources.

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	47.60	119.11	126.17	124.26	46.63	50.66	46.85	41.02	43.63	57.34	55.17	63.17	76.32	69.99	73.60	74.52	72.39	71.94	68.49	67.10

The cash conversion cycle for Eastman Chemical Co has shown fluctuations over the past eight quarters. In Q4 2023, the company had a cash conversion cycle of 71.93 days, which was significantly higher than the previous quarter but lower compared to Q4 2022. This indicates that the company took longer to convert its investments in raw materials and production into cash during this period.

In Q3 2023, the cash conversion cycle decreased to 33.93 days, reflecting a significant improvement in the company's ability to manage its working capital efficiently. However, this improvement was not sustained in Q2 2023, where the cash conversion cycle increased to 45.59 days.

Despite the fluctuations in the cash conversion cycle, Eastman Chemical Co managed to reduce its cycle in Q1 2023 to 46.90 days compared to the previous quarter. This positive trend was also observed in Q1 2022, where the company achieved a cash conversion cycle of 68.50 days, demonstrating improved efficiency in converting its assets into cash.

Overall, Eastman Chemical Co's cash conversion cycle has been volatile, with fluctuations in working capital management impacting the company's ability to efficiently convert its investments into cash. Continuous monitoring and adjustment of working capital practices may be necessary to stabilize and optimize the cash conversion cycle in the future.