Kohls Corp (KSS)

Kohls Corp's liquidity ratios have fluctuated over the past several quarters. The current ratio, which measures the company's ability to cover short-term liabilities with its current assets, has ranged from 1.14 to 2.22. This indicates some variability in the company's short-term liquidity position, with the ratio consistently above 1, indicating that Kohls Corp generally has more current assets than current liabilities.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has fluctuated between 0.04 and 1.01. This implies that Kohls Corp may have difficulty meeting its short-term obligations without relying on the sale of inventory in some periods, as the ratio is significantly below 1 for several quarters.

The cash ratio, which provides the most conservative measure of liquidity by focusing solely on cash and cash equivalents, has ranged from 0.04 to 0.95. This ratio indicates the proportion of immediate liquidity available to cover current liabilities, with values below 1 suggesting that Kohls Corp may need to rely on sources beyond cash to meet its short-term obligations.

Overall, the current ratio suggests that Kohls Corp generally has the capacity to meet its short-term obligations, but the quick and cash ratios indicate a potential need to monitor and manage liquidity more effectively, especially in periods where these ratios fall below 1. It is important for Kohls Corp to maintain a balance between current assets and liabilities to ensure ongoing financial stability and operational efficiency.

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Additional liquidity measure

The cash conversion cycle of Kohls Corp, a key metric in evaluating the efficiency of the company's working capital management, has shown fluctuations over the past few quarters.

The cash conversion cycle is a measure of how long it takes for a company to convert its resources into cash flows. A shorter cycle indicates that the company is able to sell its inventory, collect its receivables, and pay its payables more efficiently.

In the most recent period, as of February 3, 2024, Kohls Corp's cash conversion cycle stands at 41.58 days. This represents a decrease from the previous quarter, suggesting an improvement in the company's operational efficiency.

However, it is important to note that the cash conversion cycle has varied over the past few quarters, indicating fluctuations in the company's ability to efficiently manage its working capital. For instance, there was a notable increase in the cycle in the third quarter of 2023, reaching 59.38 days, which may indicate challenges in inventory turnover or collections on receivables during that period.

Overall, monitoring the cash conversion cycle of Kohls Corp can provide valuable insights into the company's working capital management and operational efficiency over time.