Hawkins Inc (HWKN)

Hawkins Inc's liquidity ratios indicate the company's ability to meet short-term obligations. The current ratio has shown some fluctuations over the years, ranging from 1.96 to 2.55. A current ratio above 1 indicates that the company has more current assets than current liabilities, with a higher ratio indicating a stronger ability to cover short-term obligations. Generally, a current ratio of 2 or higher is considered healthy.

The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has also varied, ranging from 1.18 to 1.51. This ratio indicates the company's ability to meet short-term obligations without relying on selling inventory. A quick ratio of 1 or higher is usually considered acceptable.

The cash ratio, a more conservative measure of liquidity, has ranged from 0.03 to 0.08. This ratio focuses solely on the company's ability to cover current liabilities with its cash and cash equivalents. A cash ratio of 0.05 or higher is typically considered favorable.

Overall, while the current and quick ratios have shown some fluctuations, they generally indicate that Hawkins Inc has maintained a healthy liquidity position over the years. The cash ratio, although fluctuating, also suggests that the company has sufficient cash reserves to cover its short-term obligations. Nonetheless, it is important for the company to continue monitoring and managing its liquidity position to ensure financial stability and meet its short-term commitments effectively.

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Additional liquidity measure

The cash conversion cycle of Hawkins Inc has been showing a decreasing trend over the years, indicating an improvement in the management of its working capital. As at March 31, 2021, the company's cash conversion cycle was 75.89 days, which decreased to 74.32 days as at March 31, 2022. Subsequently, the cycle further improved to 67.08 days as at March 31, 2023, and continued to decrease to 54.62 days as at March 31, 2024. However, there was a slight increase to 60.24 days as at March 31, 2025, which may warrant further analysis to understand the factors behind this change. Overall, the overall decreasing trend in the cash conversion cycle indicates efficiency in managing the company's cash flows, inventory, and receivables.