The Hain Celestial Group Inc (HAIN)

The liquidity ratios of The Hain Celestial Group Inc have shown some fluctuations over the past five years.

The current ratio, which measures the company's ability to meet its short-term obligations with its short-term assets, has generally been above 1, indicating that the company has had sufficient current assets to cover its current liabilities. The ratio peaked at 2.56 in 2023, showing a strong ability to meet short-term obligations, but then decreased in 2024 to 1.98. Overall, the current ratio has remained at healthy levels, suggesting good liquidity position.

The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. The trend of the quick ratio over the years has been relatively stable but lower than the current ratio, indicating that a significant portion of the company's current assets is tied up in inventory. The ratio has fluctuated around the 1 mark, with a low of 0.70 in 2020 and a high of 0.97 in 2023.

Furthermore, the cash ratio, which is the most conservative measure of liquidity as it only considers cash and cash equivalents, has also shown fluctuations. The company's cash ratio has generally been low, with values below 1, suggesting that a large portion of current assets are non-cash. However, the company has shown an improvement in its cash ratio over the years, reaching 0.27 in 2023 before dropping slightly to 0.19 in 2024.

In conclusion, The Hain Celestial Group Inc has maintained a generally healthy liquidity position over the past five years as indicated by the current, quick, and cash ratios. The company has had sufficient current assets to cover its short-term obligations, although there have been fluctuations in the ratios, particularly in the quick and cash ratios. The management may need to monitor the levels of inventory and non-cash assets to ensure continued liquidity strength in the future.

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Additional liquidity measure

The cash conversion cycle of The Hain Celestial Group Inc has exhibited fluctuations over the last five years. In the most recent period ending on June 30, 2024, the company's cash conversion cycle was 56.15 days, showing an improvement compared to the previous year's 67.03 days. This suggests that the company was able to manage its cash flow more efficiently, converting its investments in raw materials and inventory into cash at a quicker pace.

Looking back over the past five years, we can see that the cash conversion cycle has generally been on an upward trend since June 30, 2020. This could indicate potential challenges in managing working capital effectively and turning inventory into sales and then into cash during this period.

It is worth noting that a shorter cash conversion cycle generally indicates that the company is efficient in managing its working capital and turning its investments into cash quickly. Conversely, a longer cash conversion cycle may point to potential issues such as slow inventory turnover or delayed collection of receivables.

Overall, monitoring and analyzing the cash conversion cycle can provide valuable insights into the company's liquidity management and operational efficiency.