Energizer Holdings Inc (ENR)

The liquidity ratios provide insight into Energizer Holdings Inc's ability to meet its short-term obligations and manage its current liabilities.

The current ratio, which measures the company's ability to pay off its short-term liabilities with its current assets, has shown a fluctuating trend over the past five years. While the ratio peaked in 2022 at 2.28, it decreased to 1.52 in 2021 before rebounding to 2.12 in 2023. This indicates that in 2023, Energizer Holdings had $2.12 in current assets for every $1 of current liabilities, signaling improved short-term liquidity compared to previous years.

The quick ratio, a more stringent measure of liquidity as it excludes inventory from current assets, has also displayed a fluctuating pattern, albeit with a less pronounced increase in 2023 compared to the current ratio. The quick ratio improved to 1.24 in 2023, indicating that the company had $1.24 of highly liquid assets for every $1 of current liabilities, demonstrating an enhanced ability to meet short-term obligations without relying on inventory.

The cash ratio, which provides the most conservative measure of liquidity by focusing solely on cash and cash equivalents to cover current liabilities, has also shown fluctuation but has generally improved in recent years. In 2023, the cash ratio stood at 0.51, suggesting that Energizer Holdings had $0.51 in cash and cash equivalents for every $1 of current liabilities, indicating an increased ability to cover short-term obligations with liquid assets.

Overall, while there have been fluctuations in these liquidity ratios over the past five years, the most recent data from 2023 indicates improved short-term liquidity for Energizer Holdings Inc, as evidenced by the higher current, quick, and cash ratios.

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Additional liquidity measure

The cash conversion cycle of Energizer Holdings Inc has fluctuated over the past five years, indicating changes in its efficiency in managing its working capital. In the most recent period, the cash conversion cycle was 121.11 days, which represents the time it takes for the company to convert its investments in inventory and other resources into cash flows from sales. This was a decrease from the previous year, suggesting improved efficiency in managing its working capital.

However, when compared to the performance in 2021 and 2019, the cash conversion cycle was higher, indicating potential issues with managing working capital during those years. The company may have experienced longer periods for inventory turnover and accounts receivable collection, or had stretched payment terms with suppliers.

Overall, the trend in the cash conversion cycle reflects fluctuations in the company's efficiency in managing its working capital over the past five years, with a recent improvement in the most recent period.