Helen of Troy Ltd (HELE)

Helen of Troy Ltd's liquidity ratios have shown fluctuations over the period analyzed. The current ratio, which measures the company's ability to meet its short-term obligations, has generally remained above 1, indicating a healthy liquidity position. However, there have been some variations in the current ratio, ranging from a low of 1.58 on February 28, 2021, to a high of 2.16 on February 28, 2023.

The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has shown more volatility. The quick ratio ranged from a low of 0.04 on August 31, 2024, to a high of 0.30 on August 31, 2020. This indicates that Helen of Troy Ltd may face challenges in meeting its short-term obligations without relying on inventory during certain periods.

The cash ratio, which represents the most stringent measure of liquidity by considering only cash and cash equivalents, has also displayed fluctuations. The cash ratio ranged from 0.04 on August 31, 2024, to 0.30 on August 31, 2020. This suggests that the company may have varying levels of immediately available funds to cover its short-term liabilities.

Overall, Helen of Troy Ltd's liquidity ratios reflect a generally stable liquidity position, as indicated by the current ratio consistently above 1. However, the fluctuations in the quick ratio and cash ratio highlight the importance of closely monitoring the company's ability to meet its short-term obligations with liquid assets.

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Additional liquidity measure

The cash conversion cycle of Helen of Troy Ltd has shown fluctuations over the periods provided. Starting from 101.68 days on May 31, 2020, it increased steadily to reach a peak of 183.16 days on August 31, 2022. Subsequently, there was a gradual decrease in the cash conversion cycle, reaching a low of 136.25 days on February 29, 2024, before slightly increasing to 166.33 days by February 28, 2025.

A higher cash conversion cycle indicates that the company takes longer to convert its investments in inventory and other resources into cash inflows from sales, which can strain liquidity and working capital management. Conversely, a lower cash conversion cycle implies more efficient operations in converting resources into cash flow.

For Helen of Troy Ltd, a declining trend in the cash conversion cycle from 2022 to 2024 indicates improvements in managing inventory, accounts receivables, and accounts payables. However, the slight increase in the cycle by February 2025 suggests that the company may have experienced challenges in optimizing its working capital efficiency during that period. Further analysis and monitoring are required to assess the impacts of these fluctuations on the company's liquidity and operational performance.