Lululemon Athletica Inc. (LULU)
Liquidity ratios
| Jan 28, 2024 | Oct 29, 2023 | Jul 30, 2023 | Apr 30, 2023 | Jan 29, 2023 | Oct 30, 2022 | Jul 31, 2022 | May 1, 2022 | Jan 30, 2022 | Oct 31, 2021 | Aug 1, 2021 | May 2, 2021 | Jan 31, 2021 | Nov 1, 2020 | Aug 2, 2020 | May 3, 2020 | Feb 2, 2020 | Nov 3, 2019 | Aug 4, 2019 | May 5, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 2.49 | 2.32 | 2.40 | 2.43 | 2.12 | 1.99 | 1.98 | 1.91 | 1.86 | 2.07 | 2.32 | 2.34 | 2.41 | 2.19 | 1.95 | 2.68 | 2.91 | 2.53 | 2.41 | 2.33 |
| Quick ratio | 1.45 | 0.83 | 0.88 | 0.84 | 0.86 | 0.34 | 0.51 | 0.72 | 0.95 | 0.96 | 1.25 | 1.28 | 1.37 | 0.74 | 0.75 | 1.38 | 1.83 | 1.08 | 1.18 | 1.19 |
| Cash ratio | 1.38 | 0.75 | 0.80 | 0.76 | 0.77 | 0.27 | 0.44 | 0.65 | 0.90 | 0.89 | 1.19 | 1.22 | 1.30 | 0.66 | 0.69 | 1.30 | 1.76 | 1.02 | 1.13 | 1.15 |
Lululemon Athletica Inc. has demonstrated strong liquidity based on its current ratio over the past several quarters, ranging from 1.86 to 2.49. This indicates the company's ability to meet its short-term obligations using its current assets. However, the quick ratio and cash ratio paint a slightly different picture. The quick ratio has been fluctuating, with values ranging from 0.34 to 1.45, indicating varying levels of liquidity when considering only the most liquid assets. Similarly, the cash ratio has also shown variability, with values between 0.27 and 1.38, reflecting the company's ability to cover its current liabilities with only cash and cash equivalents on hand. Overall, while the current ratio indicates solid liquidity, the quick and cash ratios suggest that Lululemon Athletica Inc. may have some fluctuations in its ability to cover immediate obligations with its most liquid assets.
See also:
Additional liquidity measure
| Jan 28, 2024 | Oct 29, 2023 | Jul 30, 2023 | Apr 30, 2023 | Jan 29, 2023 | Oct 30, 2022 | Jul 31, 2022 | May 1, 2022 | Jan 30, 2022 | Oct 31, 2021 | Aug 1, 2021 | May 2, 2021 | Jan 31, 2021 | Nov 1, 2020 | Aug 2, 2020 | May 3, 2020 | Feb 2, 2020 | Nov 3, 2019 | Aug 4, 2019 | May 5, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 52.76 | 92.57 | 98.00 | 97.92 | 102.67 | 202.42 | 179.02 | 71.56 | 54.64 | 134.85 | 52.60 | 53.06 | 53.44 | 72.82 | 68.78 | 69.89 | 55.49 | 66.79 | 52.55 | 50.27 |
The cash conversion cycle for Lululemon Athletica Inc. fluctuated over the time period provided. The cycle measures the time it takes for a company to convert its investment in inventory and other inputs into cash flows from sales.
In analyzing the data, we observe that the cash conversion cycle ranged from a low of 52.55 days to a high of 202.42 days. A shorter cash conversion cycle is generally favorable as it indicates that the company is able to efficiently manage its working capital and generate cash quickly from its operational activities.
Lululemon exhibited a significant increase in its cash conversion cycle from Oct 30, 2022, to Oct 29, 2023, indicating potential challenges in managing inventory or receivables during that period. However, there was a notable improvement in the cycle from Oct 29, 2023, to Jan 28, 2024, suggesting a more efficient utilization of working capital.
Moreover, the company experienced relatively lower cash conversion cycles in the earlier periods, implying efficient inventory turnover and collection of receivables. This trend indicates that Lululemon managed its working capital effectively, resulting in quicker cash conversion.
Overall, Lululemon's cash conversion cycle trend reflects variations in its working capital management practices and operational efficiency over the specified time frame. Analyzing these fluctuations can provide insights into the company's liquidity, inventory management, and sales collection processes.