IPG Photonics Corporation (IPGP)

Based on the provided data for IPG Photonics Corp's liquidity ratios, we can observe the following trends:

1. Current Ratio:
- IPG Photonics Corp's current ratio has been consistently high over the past five years, ranging from 7.23 to 10.01.
- The company's current assets have been sufficient to cover its current liabilities, indicating a strong ability to meet short-term obligations.

2. Quick Ratio:
- Similarly, the quick ratio also exhibits a favorable trend, ranging from 5.38 to 8.30 over the five-year period.
- The quick assets (current assets excluding inventory) are substantial compared to current liabilities, suggesting that the company can quickly meet its short-term financial obligations even without relying on inventory liquidation.

3. Cash Ratio:
- The cash ratio for IPG Photonics Corp has also demonstrated a stable and strong performance, with values ranging from 4.61 to 7.07.
- This ratio indicates the company's ability to cover its current liabilities using only cash and cash equivalents, reflecting a high level of liquidity and financial stability.

In conclusion, IPG Photonics Corp has maintained consistently high liquidity ratios across all three metrics (current ratio, quick ratio, and cash ratio) over the past five years. These ratios suggest that the company has efficient management of its current assets and liabilities, with sufficient liquidity to meet its short-term financial obligations. This strong liquidity position can provide the company with financial flexibility and resilience in the face of potential economic uncertainties.

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Additional liquidity measure

The cash conversion cycle of IPG Photonics Corp has shown some fluctuation over the past five years. In 2023, the company's cash conversion cycle increased to 270.24 days from 247.34 days in 2022. This indicates that it took IPG Photonics Corp longer to convert its investments in inventory and receivables into cash during 2023.

Comparing to 2021 and 2020, where the cash conversion cycle was 258.82 days and 267.47 days respectively, the cycle in 2023 remained relatively higher. However, the company managed to improve its cash conversion cycle from 2019 when it was 248.34 days.

Overall, the trend in the cash conversion cycle of IPG Photonics Corp suggests some variability in the efficiency of the company's working capital management. It is important for IPG Photonics Corp to continue monitoring and optimizing its cash conversion cycle to ensure effective utilization of its resources and improved liquidity position.