John B Sanfilippo & Son Inc (JBSS)

The liquidity ratios of John B Sanfilippo & Son Inc, as reflected in the data provided, depict the company's ability to meet its short-term obligations with its current assets.

The current ratio has fluctuated over the years, with a high of 2.97 in June 2023 and a low of 2.13 in June 2020. The ratio has generally been above 2, indicating that the company has a comfortable level of current assets to cover its current liabilities. A higher current ratio suggests stronger short-term financial health.

The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has also fluctuated. The ratio stood at 0.87 in June 2023 but decreased to 0.68 in June 2024. A quick ratio below 1 suggests that the company may have difficulty meeting its short-term obligations without relying on inventory liquidation.

The cash ratio, which reflects the company's ability to meet its short-term liabilities using only cash and cash equivalents, has been relatively low, with a significant drop from 0.17 in June 2020 to 0.00 in June 2024. A lower cash ratio indicates a higher reliance on other current assets to meet short-term obligations.

Overall, while the current ratio indicates a healthy level of liquidity for John B Sanfilippo & Son Inc, the decreasing trend in the quick ratio and the low cash ratio raise some concerns about the company's ability to meet short-term obligations without relying heavily on inventory or other current assets. Further analysis and monitoring of these ratios are recommended to assess the company's liquidity position accurately.

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Additional liquidity measure

The cash conversion cycle for John B Sanfilippo & Son Inc has fluctuated over the past five years. In June 2024, the company's cash conversion cycle was 90.34 days, showing an increase compared to the previous year's 86.89 days. This suggests that the company took slightly longer to convert its investments in inventory and accounts receivable into cash.

Looking further back, in June 2022, the cash conversion cycle was higher at 102.42 days, indicating a prolonged cycle in converting resources into cash flow. However, in June 2021, there was an improvement as the cycle decreased to 81.93 days, which indicates a more efficient management of working capital during that period. In June 2020, the cycle increased to 93.97 days, showing a deterioration compared to the prior year.

Overall, the trend in the cash conversion cycle for John B Sanfilippo & Son Inc has shown some variability over the past five years, with fluctuations in efficiency in managing cash flow from operating activities. The company may benefit from a closer review of its inventory management and accounts receivable collection processes to optimize its cash conversion cycle in the future.