Expeditors International of Washington Inc (EXPD)

Expeditors International Of Washington, Inc. has maintained strong liquidity ratios over the past five years, reflecting its ability to meet short-term obligations efficiently. The current ratio, which measures the company's ability to pay off current liabilities with current assets, has shown a gradual decrease from 2.37 in 2019 to 2.02 in 2023. Despite this decline, the current ratio remains above 1, indicating that the company has more than enough current assets to cover its current liabilities.

Similarly, the quick ratio, also known as the acid-test ratio, has followed a similar trend, indicating the company's ability to meet short-term obligations without relying on inventories. The consistent ratio of 2.02 over the past five years shows that Expeditors International Of Washington, Inc. possesses sufficient liquid assets to cover its current liabilities.

The cash ratio, which provides the most conservative measure of liquidity by focusing solely on cash and cash equivalents compared to current liabilities, has also been relatively stable over the years. The ratio of 1.12 in 2023 indicates that the company holds more than enough cash to cover its short-term obligations.

Overall, the liquidity ratios of Expeditors International Of Washington, Inc. suggest that the company has effectively managed its liquidity position, maintaining a comfortable level of liquidity to meet its short-term financial commitments.

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Additional liquidity measure

Expeditors International Of Washington, Inc.'s cash conversion cycle has experienced fluctuations over the past five years. The cash conversion cycle measures how long it takes for a company to convert its investments in inventory and other resources into cash inflows from sales. A shorter cash conversion cycle is generally favorable as it indicates the company is efficient in managing its working capital.

In 2023, the company's cash conversion cycle improved significantly to 8.25 days, compared to 12.88 days in 2022. This suggests that Expeditors International has become more efficient in converting its resources into cash, potentially improving liquidity and profitability.

The trend over the five-year period shows some variability. In 2021, the cash conversion cycle was 23.25 days, which was notably longer compared to the previous and subsequent years. This may indicate challenges in managing working capital or inefficiencies in the company's operations during that period.

Overall, the trend in Expeditors International Of Washington, Inc.'s cash conversion cycle indicates improvements in recent years, reflecting potential enhancements in working capital management and operational efficiencies. Investors and analysts may view the company more positively due to the shorter cash conversion cycle in 2023, signaling effective management of resources and potential for improved financial performance.