International Seaways Inc (INSW)

International Seaways Inc's liquidity ratios show fluctuations over the years.

1. Current Ratio:
- The current ratio indicates the company's ability to cover its short-term obligations with its current assets. In 2020, the current ratio was 2.36, which reflects a healthy position. However, this ratio dropped to 0.96 in 2021, raising concerns about the company's short-term liquidity.
- The current ratio recovered in the following years, reaching 2.50 in 2022, 2.38 in 2023, and further improving to 2.87 by the end of 2024. These improvements suggest that the company's ability to meet its short-term obligations has strengthened, indicating a positive trend in liquidity.

2. Quick Ratio:
- The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. In 2020, the quick ratio was 1.83, implying a good ability to cover short-term liabilities without relying on selling inventory.
- However, the quick ratio dropped significantly to 0.42 in 2021, signaling potential liquidity challenges. Subsequently, the quick ratio showed some recovery in the following years but remained below the ideal level in 2022 (1.26), 2023 (0.95), and 2024 (1.20). This trend indicates that the company may still have some reliance on inventory to meet short-term obligations.

3. Cash Ratio:
- The cash ratio specifically focuses on the company's ability to cover its short-term liabilities using only cash and cash equivalents. The cash ratio was 1.83 in 2020, indicating a strong position in terms of cash liquidity.
- However, similar to the quick ratio, the cash ratio dropped to 0.42 in 2021, pointing to potential constraints in cash availability. While there was a recovery in the subsequent years with ratios of 1.26 in 2022, 0.95 in 2023, and 1.20 in 2024, the cash ratio remained below the initial level seen in 2020.

Overall, International Seaways Inc experienced fluctuations in its liquidity ratios, with improvements in current ratio metrics indicating enhanced short-term liquidity from 2021 to 2024. However, the quick ratio and cash ratio remained below ideal levels throughout the period, suggesting continued monitoring and management of liquidity risks.

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Additional liquidity measure

The cash conversion cycle of International Seaways Inc has shown a declining trend over the past five years, indicating an improvement in efficiency in managing its working capital. From 5.21 days in December 2020, the cycle decreased to 2.48 days by December 2021, demonstrating a more efficient cash flow management. This trend continued with further reductions to 0.49 days in December 2022 and then a slight increase to 1.09 days by December 2023. In the most recent year, December 2024, the cash conversion cycle increased to 2.11 days, but it still remains lower than in previous years.

Overall, the decreasing trend in the cash conversion cycle reflects that International Seaways Inc has been more efficient in converting its investments in inventory and receivables into cash. However, the slight increase in the cycle in 2024 suggests the company may need to focus on optimizing its working capital management to maintain or improve this efficiency in the future.