Gogo Inc (GOGO)

The current ratio for Gogo Inc has fluctuated over the years but generally indicates a healthy ability to cover its short-term obligations with current assets. It improved significantly from March 31, 2021, to December 31, 2023, showing a steady increase in liquidity. However, there was a noticeable decline in the current ratio at the end of December 31, 2024, suggesting a potential decrease in short-term liquidity.

The quick ratio, which provides a more conservative measure of liquidity by excluding inventory from current assets, also fluctuated over time. It showed a significant improvement from March 31, 2021, to December 31, 2023, indicating a strong ability to cover short-term liabilities without relying on inventory. However, there was a notable decrease in the quick ratio at the end of December 31, 2024, suggesting a potential decrease in the company's ability to meet immediate obligations without relying on inventory.

The cash ratio, which is the most conservative liquidity measure as it only includes cash and cash equivalents, followed a similar trend to the quick ratio. It showed a steady improvement from March 31, 2021, to December 31, 2023, indicating a strong ability to cover short-term liabilities with cash on hand. However, there was a significant decline in the cash ratio at the end of December 31, 2024, suggesting a potential decrease in the company's ability to meet immediate obligations with its available cash reserves.

Overall, while Gogo Inc's liquidity ratios have shown fluctuations over time, the company generally maintained adequate liquidity to cover its short-term obligations. The recent decline in liquidity ratios at the end of December 31, 2024, may require further analysis to understand the potential reasons behind this decrease in liquidity.

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Additional liquidity measure

The cash conversion cycle of Gogo Inc, a metric used to assess the efficiency of the company's cash management, has shown fluctuating trends over the past few years. From March 31, 2020, to December 31, 2024, the cash conversion cycle ranged from a low of 42.78 days to a high of 257.19 days.

Initially, the cash conversion cycle was at a manageable level, indicating efficient management of cash, inventory, and receivables. However, there was a notable increase in the cycle starting from June 30, 2022, peaking at 257.19 days by December 31, 2024. This prolonged cash conversion cycle could imply challenges related to cash flow management, inventory turnover, or collections efficiency.

The increasing trend indicates that the company may be facing difficulties in converting its investments in raw materials and finished goods back into cash. This could potentially lead to liquidity issues and impact the company's ability to meet its short-term obligations.

Overall, closer monitoring and potential improvements in inventory management practices, accounts receivable collections, and payment terms negotiation with suppliers may help Gogo Inc to streamline its cash conversion cycle and enhance its overall financial performance.