Graco Inc (GGG)
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 | 3.46 | 3.48 | 2.88 | 3.38 | 3.01 | 2.99 | 3.01 | 2.98 | 2.69 | 3.12 | 3.36 | 3.48 | 3.19 | 3.25 | 3.35 | 3.36 | 2.77 | 2.69 | 2.22 | 2.07 |
| Quick ratio | 2.26 | 2.22 | 1.81 | 1.97 | 1.71 | 1.81 | 1.85 | 1.79 | 1.87 | 2.17 | 2.33 | 2.42 | 2.16 | 2.27 | 2.31 | 2.34 | 1.71 | 1.58 | 1.31 | 1.15 |
| Cash ratio | 1.36 | 1.33 | 1.06 | 1.04 | 0.85 | 0.96 | 0.97 | 0.95 | 1.23 | 1.41 | 1.35 | 1.42 | 1.18 | 1.30 | 1.39 | 1.46 | 0.77 | 0.62 | 0.50 | 0.34 |
Graco Inc's liquidity ratios have exhibited fluctuations over the past few quarters. The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, shows a generally healthy trend, ranging from 2.69 to 3.48. This indicates that Graco Inc has an adequate level of current assets relative to its current liabilities.
The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has also shown variability, ranging from 1.58 to 2.42. Despite some fluctuations, the quick ratio generally suggests that Graco Inc has a good ability to meet its short-term obligations using its most liquid assets.
The cash ratio, which is the most conservative measure of liquidity as it considers only cash and cash equivalents to cover current liabilities, has similarly demonstrated fluctuations between 0.34 and 1.46. Overall, the cash ratio indicates that Graco Inc has maintained a reasonable level of cash to meet its short-term obligations.
In conclusion, Graco Inc's liquidity ratios show a generally positive picture, with the current, quick, and cash ratios reflecting the company's ability to cover its short-term liabilities. However, it is important for the company to closely monitor these ratios to ensure ongoing liquidity and financial stability.
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 | 188.09 | 191.81 | 195.39 | 199.21 | 190.85 | 186.46 | 196.26 | 190.06 | 176.01 | 171.94 | 176.81 | 176.47 | 174.04 | 180.05 | 183.97 | 168.33 | 161.00 | 170.95 | 174.07 | 172.19 |
The cash conversion cycle of Graco Inc has been fluctuating over the past several periods. The cycle measures the time it takes for the company to convert its investments in inventory and other resources into cash from sales to customers.
From December 2019 to September 2021, the cash conversion cycle showed a general trend of increasing, reaching a peak of 195.39 days in June 2023. However, there was a slight decrease in the cycle to 188.09 days by December 2023, indicating a potential improvement in the company's efficiency in managing its working capital.
Overall, Graco Inc should aim to continuously monitor and optimize its cash conversion cycle to ensure a balance between its accounts receivable, inventory, and accounts payable, thus maximizing cash flow and overall liquidity.