Hewlett Packard Enterprise Co (HPE)
Liquidity ratios
| Oct 31, 2024 | Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | |
|---|---|---|---|---|---|
| Current ratio | 1.29 | 0.87 | 0.88 | 0.91 | 0.88 |
| Quick ratio | 0.86 | 0.51 | 0.36 | 0.39 | 0.52 |
| Cash ratio | 0.57 | 0.19 | 0.18 | 0.19 | 0.34 |
Hewlett Packard Enterprise Co's liquidity ratios show fluctuating trends over the past five years. The current ratio has shown improvement, increasing from 0.88 in 2022 to 1.29 in 2024. This indicates that the company's ability to meet short-term obligations with current assets has strengthened over time.
However, when looking at the quick ratio, which is a more stringent measure of liquidity excluding inventory, the company's liquidity position seems less favorable. The quick ratio has been volatile, with a low of 0.36 in 2022 and a high of 0.86 in 2024. This suggests that Hewlett Packard Enterprise Co may have had difficulty meeting immediate liabilities without relying on inventory in some years.
The cash ratio, representing the firm's ability to cover current liabilities with cash and equivalents, has also shown fluctuations. It improved from 0.18 in 2022 to 0.57 in 2024, indicating a stronger cash position relative to short-term obligations.
In conclusion, Hewlett Packard Enterprise Co has shown mixed results in terms of liquidity ratios over the past five years. While the current and cash ratios have improved, the quick ratio highlights potential challenges in meeting short-term obligations without considering inventory. It is important for the company to monitor and manage its liquidity position to ensure it can cover its immediate financial obligations effectively.
See also:
Hewlett Packard Enterprise Co Liquidity Ratios
Additional liquidity measure
| Oct 31, 2024 | Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | -105.93 | -61.01 | -141.80 | -107.28 | -107.69 |
The cash conversion cycle of Hewlett Packard Enterprise Co has fluctuated over the past five years. In the most recent fiscal year ending on October 31, 2024, the company's cash conversion cycle was -105.93 days, indicating that it takes approximately 105.93 days for Hewlett Packard Enterprise Co to convert its investments in inventory and other resources into cash inflows from sales.
Compared to the previous year, the cash conversion cycle has decreased by -44.92 days from -61.01 days in October 31, 2023. This suggests that the company has improved its efficiency in managing its working capital and converting its assets into cash.
Looking further back, in fiscal year 2022, Hewlett Packard Enterprise Co had a significantly lower cash conversion cycle of -141.80 days, indicating a longer period required to convert its investments into cash. However, the company made improvements in the following years.
In fiscal year 2021 and 2020, the cash conversion cycles were -107.28 days and -107.69 days, respectively, showing relatively consistent performance in managing working capital efficiency.
Overall, the trend in the cash conversion cycle for Hewlett Packard Enterprise Co has shown improvement in recent years, indicating better efficiency in converting investments into cash inflows. The company seems to have optimized its working capital management, leading to a shorter cash conversion cycle.