Landstar System Inc (LSTR)

Landstar System Inc's liquidity ratios show a positive trend over the five-year period from 2020 to 2024.

The current ratio has improved steadily from 1.50 in 2020 to 1.96 in 2024, indicating the company's ability to cover its short-term liabilities with its current assets has strengthened.

Similarly, the quick ratio has also shown consistent growth, increasing from 1.31 in 2020 to 1.86 in 2024. This ratio reflects Landstar's ability to meet its immediate obligations without relying on inventory which is a positive sign of liquidity.

In terms of the cash ratio, Landstar System Inc had a slight decrease in 2021 (0.25) followed by significant growth in subsequent years, with the ratio reaching 0.84 in 2024. This demonstrates the company's enhanced ability to cover its current liabilities with the most liquid of its assets, cash.

Overall, the improving trend in all three liquidity ratios suggests that Landstar System Inc has been effectively managing its short-term financial obligations and maintaining a strong liquidity position over the years.

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Additional liquidity measure

Based on the data provided, Landstar System Inc has shown a consistent improvement in its cash conversion cycle from -389.61 days in December 2020 to -308.74 days in December 2024.

A negative cash conversion cycle indicates that the company is efficiently managing its working capital, with the ability to generate cash from its operations before having to pay its suppliers.

The decreasing trend in the cash conversion cycle over the years suggests that Landstar System Inc is able to convert its inventory and accounts receivable into cash at a faster pace. This can be a positive sign of effective inventory management and speedy collection of receivables, leading to improved liquidity and financial performance.

Overall, Landstar System Inc's ability to optimize its cash conversion cycle reflects positively on its operational efficiency and financial health.