Fastenal Company (FAST)
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 | 4.57 | 4.71 | 4.26 | 3.66 | 3.96 | 3.98 | 3.71 | 4.07 | 4.19 | 4.18 | 4.16 | 3.95 | 4.08 | 4.39 | 4.13 | 4.25 | 4.51 | 4.51 | 4.68 | 4.31 |
| Quick ratio | 1.98 | 2.20 | 1.92 | 1.61 | 1.57 | 1.67 | 1.59 | 1.75 | 1.67 | 1.81 | 1.89 | 1.79 | 1.66 | 1.93 | 1.72 | 1.71 | 1.68 | 1.82 | 1.88 | 1.76 |
| Cash ratio | 0.33 | 0.45 | 0.33 | 0.28 | 0.29 | 0.29 | 0.29 | 0.31 | 0.35 | 0.38 | 0.49 | 0.50 | 0.40 | 0.55 | 0.32 | 0.28 | 0.32 | 0.34 | 0.33 | 0.33 |
Fastenal Co. has showcased strong liquidity positions over the past eight quarters based on its liquidity ratios. The current ratio has consistently been above 3, reflecting the company's ability to cover its short-term obligations with its current assets. The ratio peaked in Q4 2023 at 4.71 and remained above 4 in Q4 2023 and Q1 2023.
The quick ratio, which provides a more conservative measure of liquidity by excluding inventory from current assets, has also shown stability above 1.5 over the analyzed period. This indicates that Fastenal Co. can cover its short-term liabilities without relying on the sale of inventory.
The cash ratio, which measures the company's ability to cover its current liabilities with its most liquid assets, has been in the range of 0.42 to 0.69. While the cash ratio is generally lower compared to the current and quick ratios, the values indicate that Fastenal Co. maintains a sufficient level of cash to meet its short-term obligations if necessary.
Overall, the liquidity ratios of Fastenal Co. suggest a strong financial position with ample liquidity to meet its short-term obligations and operational needs.
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 | 132.90 | 136.90 | 141.90 | 148.28 | 148.86 | 154.16 | 157.56 | 157.78 | 152.90 | 149.03 | 145.89 | 141.98 | 141.26 | 147.57 | 157.81 | 152.14 | 150.95 | 154.62 | 157.96 | 145.25 |
The cash conversion cycle of Fastenal Co. has been gradually decreasing over the last eight quarters from 204.05 days in Q1 2022 to 169.11 days in Q4 2023. This indicates an improvement in the company's efficiency in managing its working capital. The decreasing trend suggests that Fastenal Co. is becoming more effective in converting its inventory into cash, which is a positive sign for the company's liquidity and financial health. A lower cash conversion cycle means that the company is able to generate cash more quickly from its operational activities, which can be beneficial for funding growth opportunities and meeting financial obligations. Overall, the declining trend in the cash conversion cycle reflects improved working capital management by Fastenal Co.