Healthcare Services Group Inc (HCSG)
Liquidity ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 2.89 | 2.93 | 2.74 | 2.77 | 2.64 | 2.84 | 2.90 | 3.15 | 2.85 | 2.82 | 2.84 | 3.01 | 2.86 | 3.68 | 3.34 | 3.89 | 3.53 | 4.00 | 3.09 | 2.79 |
| Quick ratio | 0.56 | 0.53 | 0.62 | 0.62 | 0.68 | 0.65 | 0.64 | 0.69 | 0.68 | 0.62 | 0.70 | 0.80 | 0.97 | 1.33 | 1.42 | 1.70 | 1.63 | 1.52 | 1.01 | 0.83 |
| Cash ratio | 0.56 | 0.53 | 0.62 | 0.62 | 0.68 | 0.65 | 0.64 | 0.69 | 0.68 | 0.62 | 0.70 | 0.80 | 0.97 | 1.33 | 1.42 | 1.70 | 1.63 | 1.52 | 1.01 | 0.83 |
Healthcare Services Group Inc's liquidity ratios indicate the company's ability to meet its short-term obligations. The current ratio has remained relatively stable over the years, ranging from 2.79 to 4.00, showing that the company has a healthy level of current assets to cover its current liabilities. However, there has been a slight decrease in the current ratio towards the end of the period, possibly indicating a change in the company's liquidity position.
The quick ratio, which measures the company's ability to meet its short-term obligations without relying on inventory, has also shown a downward trend, falling from 1.63 to 0.56 by the end of the period. This suggests that the company may have less liquid assets relative to its current liabilities in the more recent periods.
The cash ratio, which is the most conservative measure of liquidity, has followed a similar pattern to the quick ratio, declining from 1.63 to 0.56. This indicates that the company may have less cash and cash equivalents available to cover its immediate liabilities.
Overall, while Healthcare Services Group Inc's current ratio indicates a healthy liquidity position, the decreasing trend in the quick and cash ratios towards the end of the period raises some concerns about the company's short-term liquidity management. Monitoring these ratios closely will be important to ensure the company's financial health and ability to meet its obligations.
Additional liquidity measure
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 4.22 | 4.39 | 4.56 | 4.56 | 4.64 | 4.75 | 4.95 | 4.97 | 5.16 | 5.50 | 5.75 | 6.24 | 6.71 | 7.01 | 7.35 | 7.38 | 7.73 | 7.82 | 7.88 | 8.57 |
The cash conversion cycle for Healthcare Services Group Inc has shown a consistent downward trend over the analyzed period, indicating improvements in the company's efficiency in managing its working capital. The cash conversion cycle measures how long it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
From March 31, 2020, to December 31, 2024, the cash conversion cycle has decreased from 8.57 days to 4.22 days. This reduction indicates that the company has been able to streamline its operations and manage its receivables and payables more effectively.
A shorter cash conversion cycle suggests that Healthcare Services Group Inc is able to collect cash from its customers faster, convert inventory into sales more efficiently, and pay its suppliers in a timely manner. This improved cycle can positively impact the company's liquidity and overall financial health.
Overall, the decreasing trend in the cash conversion cycle reflects positively on Healthcare Services Group Inc's operational efficiency and working capital management strategies, which could support its financial performance and sustainability in the long run.