JetBlue Airways Corp (JBLU)

JetBlue Airways Corp's liquidity ratios indicate a trend of fluctuation over the years. The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, decreased from 1.25 in 2020 to 0.60 in 2023, before slightly increasing to 1.06 in 2024. This implies that JetBlue may have faced challenges in its short-term liquidity position but improved by the end of 2024.

The quick ratio, a more stringent liquidity measure excluding inventory from current assets, also followed a similar trend, decreasing from 1.14 in 2020 to 0.43 in 2023, before rising to 0.93 in 2024. This indicates that JetBlue had a decreasing ability to meet its short-term obligations with its most liquid assets until a partial recovery in 2024.

The cash ratio, reflecting the proportion of current liabilities covered by cash and cash equivalents, exhibited the same trend as the quick ratio, declining from 1.14 in 2020 to 0.43 in 2023, then increasing to 0.93 in 2024. This suggests that JetBlue's cash holdings relative to its short-term obligations decreased initially but improved significantly by the end of the period.

Overall, JetBlue's liquidity ratios demonstrate variability in its ability to meet short-term obligations, with fluctuations indicating potential challenges in liquidity management during the period under review.

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Additional liquidity measure

The cash conversion cycle of JetBlue Airways Corp has shown fluctuations over the past five years. As of December 31, 2020, the company's cash conversion cycle stood at 6.35 days, indicating that it took around 6.35 days for JetBlue to convert its investments in inventory and other resources into cash inflows.

By December 31, 2021, the cash conversion cycle had improved to 4.75 days, suggesting that JetBlue was able to manage its working capital more effectively, resulting in a shorter cycle for converting investments into cash.

The trend continued to improve in the following years, with the cash conversion cycle decreasing to 4.13 days as of December 31, 2022, and to 4.57 days by December 31, 2023. These reductions in the cash conversion cycle demonstrate an enhanced efficiency in JetBlue's working capital management practices.

However, by December 31, 2024, the cash conversion cycle increased significantly to 12.42 days, indicating a potential delay in converting investments into cash inflows. This could be a result of various factors such as changes in inventory management, accounts receivable collection, or payment terms with suppliers.

Overall, JetBlue Airways Corp has experienced both improvements and setbacks in its cash conversion cycle over the five-year period, highlighting the importance of closely monitoring working capital efficiency to ensure optimal financial performance.