Huntington Ingalls Industries Inc (HII)
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 | 1.08 | 0.79 | 0.82 | 0.96 | 0.95 | 0.92 | 0.96 | 0.96 | 0.95 | 0.97 | 1.15 | 1.15 | 1.15 | 1.14 | 1.09 | 1.07 | 1.10 | 1.29 | 1.30 | 1.03 |
| Quick ratio | 0.42 | 0.19 | 0.26 | 0.29 | 0.35 | 0.35 | 0.44 | 0.41 | 0.44 | 0.35 | 0.48 | 0.48 | 0.52 | 0.50 | 0.44 | 0.41 | 0.49 | 0.63 | 0.58 | 0.27 |
| Cash ratio | 0.28 | 0.00 | 0.00 | 0.00 | 0.14 | 0.04 | 0.11 | 0.11 | 0.16 | 0.04 | 0.15 | 0.14 | 0.26 | 0.23 | 0.16 | 0.18 | 0.23 | 0.33 | 0.30 | 0.01 |
Huntington Ingalls Industries Inc's liquidity ratios indicate its ability to meet short-term obligations and manage its day-to-day operations. The current ratio has shown some fluctuation over the years, starting at a low of 1.03 in March 2020, reaching a peak of 1.30 in June 2020, and gradually decreasing to 0.79 by September 30, 2024. The current ratio measures the company's ability to cover its short-term liabilities with its current assets, and a ratio above 1 is generally considered healthy.
The quick ratio, which provides a more conservative measure of liquidity by excluding inventories from current assets, also fluctuated over the period. It ranged from a low of 0.19 on September 30, 2024, to a high of 0.63 on September 30, 2020. A quick ratio above 1 is considered favorable, as it indicates that the company can meet its short-term obligations without relying on the sale of inventory.
The cash ratio, reflecting the company's ability to cover its current liabilities with its cash and cash equivalents, showed a downward trend from September 30, 2020, to December 31, 2024, with values ranging from 0.00 to 0.33. While a cash ratio of zero is not ideal, it is not uncommon for companies in certain industries to have low cash ratios due to the nature of their operations.
Overall, the liquidity ratios of Huntington Ingalls Industries Inc suggest that the company has maintained a reasonable ability to meet its short-term obligations, although there were some fluctuations over the years. Investors and stakeholders may want to monitor these ratios closely to assess the company's liquidity position and ability to withstand unexpected financial challenges.
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 | -125.44 | -171.58 | -186.41 | -176.01 | -103.16 | -163.68 | -156.01 | -156.03 | -140.99 | -161.11 | -158.85 | -120.88 | -139.35 | -122.18 | -63.77 | -84.19 | -100.66 | -89.03 | -97.46 | -147.48 |
The cash conversion cycle of Huntington Ingalls Industries Inc has demonstrated fluctuations over the past few quarters. The company's cash conversion cycle ranged between -63.77 days to -186.41 days during the period from June 30, 2021, to September 30, 2024. A negative cash conversion cycle indicates that the company is efficiently managing its working capital, resulting in quicker conversion of inventory into cash.
During the most recent period, ending September 30, 2024, the cash conversion cycle was recorded at -171.58 days, which represents a slight improvement from the previous quarter. It implies that the company has been successful in reducing the time taken to convert its investments in inventory back to cash, indicating effective management of operating liquidity.
However, it is important to note that continual decreases in the cash conversion cycle may also indicate aggressive inventory management, potentially leading to stockouts or production disruptions. Therefore, it is crucial for the company to strike a balance between efficiently managing working capital and ensuring the smooth operations of its business.
Overall, based on the data provided, Huntington Ingalls Industries Inc has maintained a negative cash conversion cycle, reflecting operational efficiency in managing its working capital and converting inventory into cash swiftly.