Itron Inc (ITRI)

Itron Inc's liquidity position, as indicated by its current ratio, has shown some fluctuations over the years, ranging from 1.50 to 3.44. The current ratio measures the company's ability to meet its short-term obligations with its current assets. Generally, a current ratio above 1 indicates that the company can cover its current liabilities with its current assets. Therefore, Itron Inc has maintained a current ratio above 1, reflecting a healthy liquidity position.

The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. Itron Inc's quick ratio has varied from 0.92 to 2.65, with the latest value well above 1. This suggests that the company has a solid ability to meet its short-term obligations using only its most liquid assets.

Furthermore, the cash ratio, which measures the company's ability to pay off its current liabilities with only cash and cash equivalents, has also displayed an increasing trend, reaching 1.99 in the latest period. This indicates that Itron Inc has a substantial amount of cash on hand relative to its short-term liabilities, enhancing its liquidity position.

In conclusion, based on the current ratio, quick ratio, and cash ratio, Itron Inc appears to have a strong liquidity position, with sufficient current assets and cash reserves to meet its short-term financial obligations.

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Additional liquidity measure

The cash conversion cycle is a key metric for measuring the efficiency of a company's working capital management. It represents the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.

Analyzing the data for Itron Inc, we observe fluctuations in the cash conversion cycle over the five-year period provided. In 2020, the cash conversion cycle was 58.85 days, indicating that on average, Itron took just under 59 days to convert its investments into cash.

Subsequently, in 2021, the cycle improved to 52.34 days, suggesting that Itron became more efficient in managing its working capital and converting inventory into cash within a shorter timeframe. However, this trend reversed in 2022, with the cycle increasing to 55.32 days.

In 2023, the cash conversion cycle further extended to 67.90 days, indicating potential challenges in the company's working capital management or delays in converting investments into cash flows. The following year, 2024, showed a significant increase to 75.81 days, suggesting a prolonged cycle for converting investments into cash.

Overall, the trend in Itron's cash conversion cycle is somewhat inconsistent, with improvements observed in some years followed by setbacks in others. It is important for the company to focus on optimizing its working capital efficiency to ensure a more stable and consistent cash conversion cycle over time.