Jacobs Solutions Inc. (J)

Based on the provided data, we can analyze the liquidity ratios of Jacobs Solutions Inc. over the past five years.

1. Current Ratio:
The current ratio measures the company's ability to cover its short-term obligations with its current assets. Jacobs Solutions Inc.'s current ratio has fluctuated over the years, ranging from 1.34 to 1.54. The current ratio as of September 30, 2023, stands at 1.37, indicating that the company has $1.37 in current assets for every $1 in current liabilities. While the current ratio has shown some variability, it generally indicates the company's ability to meet its short-term debt obligations.

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. Jacobs Solutions Inc.'s quick ratio has ranged from 1.28 to 1.49 over the past five years, with a value of 1.31 as of September 30, 2023. This indicates that the company has $1.31 in liquid assets available to cover each $1 of current liabilities, showing a slightly lower liquidity position when compared to the current ratio.

3. Cash Ratio:
The cash ratio focuses solely on the company's ability to cover its current liabilities with cash and cash equivalents. Jacobs Solutions Inc.'s cash ratio has ranged from 0.27 to 0.41 over the past five years, with a value of 0.27 recorded as of September 30, 2023. A cash ratio below 1 implies that the company may not have sufficient cash on hand to meet its short-term obligations without relying on other current assets.

Overall, while the current, quick, and cash ratios provide insights into Jacobs Solutions Inc.'s liquidity position, fluctuations in these ratios over the years may indicate changes in the company's ability to meet its short-term financial obligations. It is important for the company to maintain a balance between its current assets and liabilities to ensure financial stability and operational efficiency.

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Additional liquidity measure

Jacobs Solutions Inc.'s cash conversion cycle has shown some fluctuation over the past five years. In the most recent period of September 30, 2023, the company's cash conversion cycle stood at 52.50 days, indicating that it took approximately 52.50 days for the company to convert its investments in inventory and other resources into cash from sales.

Compared to the prior year, the cash conversion cycle decreased from 57.69 days in September 2022 to 52.50 days in September 2023, suggesting an improvement in efficiency in managing its working capital. However, it is worth noting that the cycle has been somewhat volatile over the years, with fluctuations seen in each period.

Overall, analyzing the cash conversion cycle helps evaluate how efficiently Jacobs Solutions Inc. manages its resources to generate cash flow, indicating its operational effectiveness and liquidity in turning its assets into cash.