Lithia Motors Inc (LAD)
Liquidity ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.19 | 1.18 | 1.19 | 1.17 | 1.41 | 1.33 | 1.36 | 1.30 | 1.46 | 1.66 | 1.59 | 1.38 | 1.38 | 1.41 | 1.49 | 1.26 | 1.35 | 1.24 | 1.20 | 1.20 |
| Quick ratio | 0.22 | 0.21 | 0.25 | 0.23 | 0.42 | 0.26 | 0.24 | 0.26 | 0.34 | 0.42 | 0.40 | 0.37 | 0.44 | 0.44 | 0.61 | 0.35 | 0.31 | 0.26 | 0.28 | 0.15 |
| Cash ratio | 0.03 | 0.03 | 0.07 | 0.04 | 0.20 | 0.03 | 0.02 | 0.05 | 0.09 | 0.06 | 0.02 | 0.05 | 0.06 | 0.06 | 0.30 | 0.07 | 0.06 | 0.03 | 0.06 | 0.02 |
Lithia Motors Inc's liquidity ratios demonstrate the company's ability to meet short-term obligations. The current ratio has shown fluctuations over the years, ranging from 1.17 to 1.66. This ratio indicates that the company has generally maintained a sufficient level of current assets to cover its current liabilities.
The quick ratio, which includes only the most liquid assets, such as cash and accounts receivable, has also varied, with values between 0.15 and 0.61. This ratio indicates the company's ability to meet its short-term liabilities without relying on inventory sales.
The cash ratio, which focuses solely on the most liquid asset, cash, ranges between 0.02 and 0.30. This ratio provides insight into the company's ability to cover its current liabilities with cash on hand.
Overall, while there have been fluctuations in the liquidity ratios of Lithia Motors Inc, the company has maintained a generally healthy liquidity position, indicating its ability to manage short-term financial obligations.
Additional liquidity measure
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 71.35 | 76.54 | 79.96 | 79.28 | 68.87 | 64.41 | 63.81 | 59.31 | 54.37 | 57.29 | 54.20 | 51.65 | 51.66 | 48.30 | 59.52 | 74.76 | 85.70 | 97.90 | 88.95 | 114.86 |
The cash conversion cycle of Lithia Motors Inc has shown a decreasing trend from March 2020 to December 2024. The company's cash conversion cycle measures the time it takes for the company to convert its investments in inventory and other resources into cash inflows from sales.
From March 2020 to December 2024, the cash conversion cycle decreased from 114.86 days to 71.35 days. This signifies that the company improved its efficiency in managing its inventory, collecting receivables, and paying its payables over this period.
A decreasing trend in the cash conversion cycle indicates that Lithia Motors Inc has been able to more quickly convert its investments in inventory and other resources into cash receipts from sales. This could be due to more effective inventory management, streamlined sales and collection processes, and optimized payment terms with suppliers.
Overall, the decreasing trend in the cash conversion cycle for Lithia Motors Inc is a positive indicator of the company's operational efficiency and ability to generate cash flow from its operating activities.