HNI Corp (HNI)

Liquidity ratios

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 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Current ratio 1.16 1.14 1.22 1.27 1.19 1.17 1.27 1.15 1.03 1.21 1.25 1.23 1.13 1.20 1.19 1.32 1.10 1.19 1.21 1.30
Quick ratio 0.61 0.06 0.06 0.05 0.60 0.05 0.04 0.05 0.58 0.26 0.26 0.24 0.74 0.27 0.08 0.10 0.68 0.71 0.65 0.74
Cash ratio 0.07 0.06 0.06 0.05 0.05 0.05 0.04 0.05 0.11 0.26 0.26 0.24 0.27 0.27 0.08 0.10 0.11 0.12 0.07 0.13

HNI Corp's liquidity ratios over the past few quarters show some fluctuations. The current ratio, which measures the company's ability to pay its short-term obligations with its current assets, has generally been above 1, indicating that the company has had enough current assets to cover its current liabilities. However, there has been some variability in this ratio, ranging from 1.03 to 1.32.

On the other hand, the quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has shown significant fluctuations and has been consistently below 1. This may indicate potential difficulties in meeting short-term obligations without relying on selling inventory.

The cash ratio, which is the most conservative liquidity measure as it only considers cash and cash equivalents, has also varied over time but generally remains low compared to the current ratio. This suggests that the company may have limited cash on hand to cover its immediate liabilities.

Overall, the fluctuations in these liquidity ratios suggest that HNI Corp's ability to meet its short-term obligations has been somewhat inconsistent and may warrant further investigation to understand the underlying reasons behind these changes.

Additional liquidity measure

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 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Cash conversion cycle days 37.54 40.20 43.06 34.62 36.14 35.13 36.00 34.34 31.05 33.67 35.06 30.12 28.83 27.39 28.33 29.38 33.73 76.24 74.37 66.40

The cash conversion cycle of HNI Corp has shown fluctuations over the past few quarters. The cash conversion cycle measures how long it takes for a company to convert its investments in inventory into cash flows from sales. A shorter cash conversion cycle indicates that a company is efficiently managing its working capital.

Looking at the data provided, we observe that the cash conversion cycle ranged from a low of 27.39 days in Sep 2020 to a high of 76.24 days in Dec 2019. In general, a decreasing trend is observed from 2019 to 2023, with occasional fluctuations in between.

Dec 2023 showed a cash conversion cycle of 37.54 days, showing a slight increase from the previous quarter. HNI Corp seems to be taking slightly longer to convert its investments in inventory to cash in this period. This increase could be due to various reasons such as changes in sales patterns, inventory management practices, or collection policies.

It is important for HNI Corp to monitor its cash conversion cycle closely as it directly impacts the company's liquidity and cash flow. Analyzing the components of the cash conversion cycle, including the days sales outstanding (DSO), days inventory outstanding (DIO), and days payables outstanding (DPO), can provide valuable insights into the efficiency of the company's operations and working capital management.

Overall, a decreasing trend in the cash conversion cycle is generally positive as it indicates that the company is becoming more efficient in converting its investments into cash. HNI Corp should continue to focus on optimizing its working capital management to improve its cash conversion cycle and enhance its overall financial performance.