Greenbrier Companies Inc (GBX)

The liquidity ratios of Greenbrier Companies Inc provide insights into the company's ability to meet its short-term financial obligations. The current ratio, which measures the firm's ability to cover its current liabilities with current assets, has been declining over the past five years, from 1.67 in 2020 to 1.15 in 2024. This downward trend indicates a potential weakening in the company's short-term liquidity position.

Similarly, the quick ratio, which excludes inventory from current assets to provide a more stringent measure of liquidity, has also shown a decreasing trend over the years, dropping from 1.03 in 2020 to 0.34 in 2024. This suggests that Greenbrier's ability to meet its short-term obligations with its most liquid assets has deteriorated.

Moreover, the cash ratio, which represents the proportion of current liabilities that can be covered by cash and cash equivalents, has also displayed a downward trend, declining from 1.02 in 2020 to 0.29 in 2024. This indicates a decreased reliance on cash reserves to meet short-term obligations, posing potential liquidity challenges for the company.

Overall, the declining trend in Greenbrier Companies Inc's liquidity ratios over the past five years raises concerns about its ability to efficiently manage its short-term financial obligations. Investors and stakeholders should closely monitor these ratios to assess the company's liquidity position and its ability to weather potential financial challenges in the future.

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Additional liquidity measure

The cash conversion cycle for Greenbrier Companies Inc has shown fluctuations over the past five years. In particular, the cycle has ranged from a low of 80.43 days in 2020 to a high of 161.49 days in 2021. In 2024, the cycle decreased to 98.87 days compared to the previous year's 89.72 days. This indicates that the company has been improving its efficiency in managing its cash, inventory, and receivables over the years, leading to a shorter cash conversion cycle. Overall, a decreasing trend in the cash conversion cycle reflects a positive performance as it shows that the company is able to convert its investments in inventory and receivables into cash more quickly.