Lennar Corporation (LEN)

Lennar Corporation's liquidity ratios show a positive trend over the years, indicating a strong ability to meet its short-term obligations. The current ratio has increased steadily from 4.20 in November 30, 2020, to 15.81 in November 30, 2024. This suggests that the company's current assets are significantly higher than its current liabilities, providing a comfortable margin of safety.

Similarly, the quick ratio, which measures the company's ability to pay off its current liabilities without relying on inventory, has shown consistent improvement from 2.81 in November 30, 2020, to 4.68 in November 30, 2024. This indicates that Lennar Corporation has ample liquid assets to cover its short-term obligations efficiently.

Moreover, the cash ratio, which specifically focuses on the firm's ability to cover current liabilities with its cash and cash equivalents, has also exhibited a favorable trend from 2.81 in November 30, 2020, to 4.68 in November 30, 2024. This highlights the company's strong liquidity position and its ability to meet its short-term financial commitments without difficulty.

Overall, Lennar Corporation's liquidity ratios demonstrate a healthy financial position and suggest that the company is well-equipped to manage its short-term financial obligations effectively.

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Additional liquidity measure

The cash conversion cycle for Lennar Corporation was 348.22 days as of November 30, 2020. This indicates that it took the company approximately 348 days to convert its investments in inventory and other resources into cash from sales.

However, from November 30, 2021 onwards, the cash conversion cycle dropped significantly to 0.00 days. This could suggest an improvement in the company's efficiency in managing its working capital and converting its assets into cash. A cash conversion cycle of 0.00 days indicates that the company is able to quickly convert its investments into cash, which can be a positive sign for its overall liquidity and financial health.

It's important to monitor the cash conversion cycle over time to assess the company's ability to efficiently manage its working capital and generate cash flows from its operations.