General Mills Inc (GIS)
Liquidity ratios
| May 31, 2024 | May 26, 2024 | May 31, 2023 | May 28, 2023 | May 31, 2022 | |
|---|---|---|---|---|---|
| Current ratio | 0.65 | 0.65 | 0.69 | 0.69 | 0.63 |
| Quick ratio | 0.06 | 0.30 | 0.09 | 0.32 | 0.10 |
| Cash ratio | 0.06 | 0.06 | 0.09 | 0.09 | 0.10 |
General Mills Inc's liquidity ratios show some fluctuations over the years. The current ratio, which measures the company's ability to cover short-term liabilities with current assets, has ranged from 0.63 to 0.69 over the past few years. This indicates that General Mills may have had some difficulty in meeting its short-term obligations with its current assets.
The quick ratio, which provides a more conservative measure of liquidity by excluding inventory from current assets, has also shown variability, ranging from 0.09 to 0.32. The fluctuations in this ratio suggest that General Mills may have had varying levels of short-term liquidity over the period analyzed.
Additionally, the cash ratio, which focuses solely on the most liquid assets (cash and cash equivalents) compared to current liabilities, has remained relatively stable, ranging from 0.06 to 0.10. This indicates that General Mills has maintained a consistent level of cash reserves compared to its short-term obligations.
Overall, General Mills' liquidity ratios suggest that while the company has faced challenges in meeting its short-term obligations with its current assets, it has generally maintained a stable level of cash reserves relative to its current liabilities.
See also:
Additional liquidity measure
| May 31, 2024 | May 26, 2024 | May 31, 2023 | May 28, 2023 | May 31, 2022 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 53.60 | 303.81 | 58.51 | 313.87 | 54.13 |
The cash conversion cycle of General Mills Inc has shown fluctuations over the period under review. Starting at 54.13 days on May 31, 2022, it increased significantly to 313.87 days by May 28, 2023, indicating a lengthening of the cycle. However, there was a notable improvement by May 31, 2023, where the cycle reduced to 58.51 days. Subsequently, the cycle increased again to 303.81 days by May 26, 2024, before decreasing to 53.60 days by May 31, 2024.
Overall, despite the fluctuations observed, the trend indicates a need for the company to better manage its working capital components – accounts receivable, inventory, and accounts payable – to optimize cash flow efficiency and minimize the time taken to convert resources into cash.