Heritage Financial Corporation (HFWA)
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 | — | 0.22 | 0.03 | 0.04 | 0.06 | 0.28 | 0.27 | 0.31 | 0.27 | 0.33 | 0.41 | 0.47 | 0.48 | 0.46 | 0.45 | 14.89 | 28.67 | 13.67 | 11.01 | 8.23 |
| Quick ratio | — | 0.24 | 0.22 | 0.25 | 0.31 | 0.27 | 0.27 | 0.31 | 0.27 | 0.33 | 0.40 | 0.47 | 0.48 | 0.45 | 0.45 | 14.73 | 28.31 | 13.48 | 10.86 | 8.12 |
| Cash ratio | — | 0.24 | 0.22 | 0.25 | 0.31 | 0.27 | 0.27 | 0.31 | 0.27 | 0.33 | 0.40 | 0.47 | 0.48 | 0.45 | 0.45 | 14.73 | 28.31 | 13.48 | 10.86 | 8.12 |
Heritage Financial Corporation's liquidity ratios, specifically the current ratio, quick ratio, and cash ratio, display a fluctuating trend over the reporting periods from March 31, 2020, to December 31, 2024.
The current ratio, which measures the company's ability to meet its short-term obligations with its current assets, shows a decline from a high of 28.67 on December 31, 2020, to a low of 0.03 on June 30, 2024. This significant drop in the current ratio suggests a potential liquidity challenge for Heritage Financial Corporation in meeting its current liabilities.
Similarly, the quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. The quick ratio follows a similar trend as the current ratio, declining from 28.31 on December 31, 2020, to 0.22 on June 30, 2024. This indicates a diminishing ability to pay off short-term liabilities without relying on inventory sales.
The cash ratio, which focuses solely on the company's ability to cover its current liabilities with cash and cash equivalents, reflects a consistent decrease over the reporting periods. The ratio drops from 28.31 on December 31, 2020, to 0.24 on September 30, 2024. This declining cash ratio signals a potential strain on the company's ability to settle immediate obligations with liquid assets.
In conclusion, Heritage Financial Corporation's liquidity ratios show a concerning trend of decreasing liquidity and may indicate potential challenges in meeting short-term obligations with available resources. Further analysis and proactive liquidity management strategies may be necessary to address these liquidity concerns and ensure the company's financial stability.
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 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
The cash conversion cycle for Heritage Financial Corporation has consistently been 0.00 days across all periods from March 31, 2020, to December 31, 2024. This indicates that the company is able to efficiently manage its cash flow in terms of converting inventory into sales and collecting receivables, resulting in a quick turnaround of cash. A lower cash conversion cycle is generally favorable as it signifies that the company is able to generate cash quickly from its operations, which can be beneficial for working capital management and overall financial health. It also suggests effective inventory and accounts receivable management practices within the company.