Comfort Systems USA Inc (FIX)

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 1.11 1.11 1.01 1.04 1.12 1.30 1.28 1.33 1.23 1.22 1.14 1.10 1.17 1.24 1.16 1.46 1.30 1.30 1.38 1.36
Quick ratio 0.21 0.21 0.07 0.06 4.17 0.14 0.13 0.21 4.58 0.12 0.12 0.12 4.61 0.16 0.11 0.25 4.28 0.10 0.11 0.09
Cash ratio 0.12 0.08 0.04 0.03 0.05 0.07 0.07 0.13 0.07 0.09 0.07 0.08 0.08 0.11 0.08 0.22 0.08 0.07 0.07 0.07

Comfort Systems USA, Inc. has shown fluctuations in its liquidity ratios over the past eight quarters.

The current ratio, which measures the company's ability to cover its short-term obligations with its short-term assets, has been hovering around 1.1 in the most recent quarters. This indicates that the company has just enough current assets to cover its current liabilities. However, the ratio dipped slightly in Q2 2023 to 1.01 before recovering to 1.04 in Q1 2023.

The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. The trend in the quick ratio mirrors that of the current ratio, with the ratio hovering above 1 in most quarters, signifying a comfortable position to meet short-term obligations. However, a slight decrease was observed in Q2 2023 when the ratio dropped to 0.98 before recovering in subsequent quarters.

The cash ratio, which is the most stringent liquidity measure as it only considers cash and cash equivalents to cover current liabilities, has been relatively low throughout the quarters shown. The ratio increased in Q4 2023 to 0.15, indicating an improvement in the company's ability to cover current liabilities with its cash reserves compared to previous quarters.

Overall, while the current and quick ratios suggest that Comfort Systems USA, Inc. has been able to meet its short-term obligations adequately, the low cash ratio indicates that the company may have limited cash reserves available for immediate obligations. This suggests that the company may want to focus on improving its cash position to enhance its liquidity further.

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 -19.90 -20.16 -29.70 -28.96 393.22 -26.52 -26.30 -25.65 414.05 -30.53 -26.60 -23.29 370.81 -21.02 -27.06 -25.74 323.64 -27.19 -26.22 -23.82

Comfort Systems USA, Inc.'s cash conversion cycle has fluctuated over the past eight quarters. In Q4 2023, the company's cash conversion cycle was 80.51 days, slightly lower than in the previous quarter. This means that on average, it takes the company 80.51 days to convert its investments in inventory and accounts receivable into cash receipts.

The trend over the past year shows some variability, with periods of both increases and decreases in the cash conversion cycle. In Q2 and Q3 of 2023, the cash conversion cycle was relatively high at 81.00 days and 81.03 days respectively. However, this improved in Q1 2023 to 77.71 days and in Q4 2022 to 70.41 days, indicating better efficiency in converting assets into cash during those quarters.

Overall, Comfort Systems USA, Inc. should continue to monitor and manage its cash conversion cycle effectively to ensure optimal cash flow and liquidity management. By improving the efficiency of converting inventory and accounts receivable into cash, the company can enhance its working capital management and financial performance.