IDEX Corporation (IEX)

The liquidity ratios of Idex Corporation show the company's ability to meet its short-term obligations and highlight its financial health in the short run. Looking at the current ratio, we can see that it has been relatively stable over the past five years, ranging from 2.57 to 4.15. A current ratio above 1 indicates that the company has more current assets than current liabilities, and a higher ratio signifies a stronger liquidity position. Idex Corporation's current ratio has generally been above 2, indicating a strong ability to cover its short-term obligations.

The quick ratio, which excludes inventory from current assets, provides a more conservative measure of liquidity. Like the current ratio, the quick ratio has also shown consistency over the years, ranging from 1.71 to 3.43. A quick ratio above 1 suggests that the company can meet its short-term liabilities without relying on the sale of inventory, and Idex Corporation's quick ratio has consistently been above 1, indicating a sound liquidity position.

The cash ratio, which is the most conservative liquidity ratio, focuses solely on cash and cash equivalents to cover short-term liabilities. Idex Corporation's cash ratio has fluctuated over the years but has generally remained above 1, ranging from 0.89 to 2.69. A cash ratio above 1 implies that the company has enough cash on hand to cover its immediate liabilities, and Idex Corporation's cash ratio has demonstrated a strong ability to meet short-term obligations with cash reserves.

In conclusion, based on the current ratio, quick ratio, and cash ratio, Idex Corporation appears to have maintained a solid liquidity position over the past five years, with adequate resources to meet its short-term obligations.

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Additional liquidity measure

Idex Corporation's cash conversion cycle has shown fluctuations over the past five years. In 2023, the company's cash conversion cycle was 95.86 days, marking an improvement compared to 2022 when it stood at 105.28 days. However, the cycle was longer than in 2021, which was 92.45 days. Looking further back, in 2020 and 2019, the cash conversion cycle was 83.51 days and 84.94 days, respectively.

The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales. A shorter cycle indicates that the company is able to efficiently manage its working capital and liquidity. On the other hand, a longer cycle may point to potential inefficiencies in inventory management or delays in collecting receivables.

Overall, Idex Corporation's cash conversion cycle has varied in recent years, suggesting potential changes in the company's operational efficiency and liquidity management. Further analysis would be needed to determine the specific factors driving these fluctuations and to assess the implications for the company's financial health and performance.