GameStop Corp (GME)
Liquidity ratios
| Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 30, 2021 | Oct 31, 2020 | Aug 1, 2020 | May 2, 2020 | Feb 1, 2020 | Nov 2, 2019 | Aug 3, 2019 | May 4, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 2.11 | 1.65 | 1.87 | 1.71 | 1.74 | 1.63 | 2.17 | 2.07 | 1.92 | 1.90 | 2.22 | 1.36 | 1.16 | 1.05 | 1.05 | 0.93 | 1.32 | 1.18 | 1.37 | 1.48 |
| Quick ratio | 1.38 | 0.90 | 1.19 | 1.08 | 1.15 | 0.73 | 1.08 | 1.01 | 1.04 | 0.98 | 1.50 | 0.65 | 0.46 | 0.33 | 0.62 | 0.43 | 0.52 | 0.28 | 0.45 | 0.52 |
| Cash ratio | 1.28 | 0.84 | 1.12 | 0.99 | 1.04 | 0.66 | 0.97 | 0.92 | 0.94 | 0.92 | 1.44 | 0.57 | 0.38 | 0.28 | 0.56 | 0.38 | 0.40 | 0.18 | 0.35 | 0.42 |
GameStop Corp's liquidity ratios, including the current ratio, quick ratio, and cash ratio, show a mixed trend over the past few reporting periods. The current ratio, which measures the company's ability to pay off its short-term liabilities with its current assets, has generally been fluctuating but has shown some improvement recently. The current ratio stood at 2.11 in the most recent period, indicating a stronger liquidity position compared to previous periods.
The quick ratio, which provides a more conservative measure of liquidity by excluding inventory from current assets, has also shown variability but has improved in the latest period to reach 1.38. This suggests that GameStop Corp may be in a better position to meet its short-term obligations without relying on inventory.
The cash ratio, which indicates the company's ability to cover its current liabilities with its cash and cash equivalents, has been inconsistent but has demonstrated improvement in the most recent period at 1.28. This could signify that GameStop Corp has a higher proportion of cash on hand to meet its immediate financial obligations.
Overall, while GameStop Corp's liquidity ratios have shown some volatility in the past, the recent improvements in the current, quick, and cash ratios suggest enhanced liquidity and a better ability to manage short-term financial obligations. However, continued monitoring of these ratios is essential to assess the company's ongoing liquidity position.
See also:
Additional liquidity measure
| Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 30, 2021 | Oct 31, 2020 | Aug 1, 2020 | May 2, 2020 | Feb 1, 2020 | Nov 2, 2019 | Aug 3, 2019 | May 4, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 34.60 | 23.23 | 29.38 | 23.86 | 21.62 | 26.53 | 45.44 | 46.57 | 43.32 | 40.31 | 20.66 | 23.45 | 32.39 | 46.41 | 25.22 | 43.62 | 46.37 | 47.16 | 43.18 | 49.19 |
The cash conversion cycle measures how long it takes a company to convert its investments in inventory and other resources into cash flows from sales. A shorter cash conversion cycle is generally preferable as it indicates faster cash flows and greater efficiency in managing working capital.
Analyzing GameStop Corp's cash conversion cycle over the past 20 periods, we observe fluctuations in the efficiency of its working capital management. The company's cash conversion cycle has ranged from a low of 20.66 days to a high of 49.19 days.
In more recent periods, GameStop Corp has demonstrated an improvement in its cash conversion cycle, with the cycle ranging from 21.62 days to 34.60 days. This indicates that the company has been more effective in managing its inventory, accounts receivable, and accounts payable during these periods, resulting in quicker cash conversion.
However, it is worth noting that GameStop Corp experienced periods with longer cash conversion cycles, exceeding 40 days, which may suggest potential inefficiencies in working capital management. A longer cash conversion cycle can tie up cash and potentially lead to liquidity challenges for the company.
Going forward, GameStop Corp should continue to focus on optimizing its operations to maintain a shorter cash conversion cycle, which can contribute to improved liquidity, profitability, and overall financial performance.