Lululemon Athletica Inc. (LULU)
Liquidity ratios
| Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Jan 28, 2024 | Oct 31, 2023 | Oct 29, 2023 | Jul 31, 2023 | Jul 30, 2023 | Apr 30, 2023 | Jan 31, 2023 | Jan 29, 2023 | Oct 31, 2022 | Oct 30, 2022 | Jul 31, 2022 | May 1, 2022 | Apr 30, 2022 | Jan 31, 2022 | Jan 30, 2022 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 2.16 | 1.57 | 2.43 | 2.72 | 2.49 | 2.49 | 2.32 | 2.32 | 2.40 | 2.40 | 2.43 | 2.12 | 2.12 | 1.99 | 1.99 | 1.98 | 1.91 | 1.91 | 1.86 | 1.86 |
| Quick ratio | 1.08 | 0.60 | 1.10 | 1.37 | 1.38 | 1.45 | 0.75 | 0.83 | 0.80 | 0.88 | 0.76 | 0.77 | 0.86 | 0.27 | 0.34 | 0.44 | 0.72 | 0.65 | 1.12 | 0.95 |
| Cash ratio | 1.08 | 0.60 | 1.10 | 1.37 | 1.38 | 1.38 | 0.75 | 0.75 | 0.80 | 0.80 | 0.76 | 0.77 | 0.77 | 0.27 | 0.27 | 0.44 | 0.65 | 0.65 | 1.12 | 0.90 |
The liquidity ratios of Lululemon Athletica Inc. show a strong financial position in terms of its ability to meet short-term obligations.
1. Current Ratio: The current ratio has improved steadily over the years, increasing from 1.86 in January 2022 to 2.16 in January 2025. This indicates that for every dollar of current liabilities, Lululemon has $2.16 of current assets available to cover those obligations.
2. Quick Ratio: The quick ratio measures the company's ability to pay off its current liabilities without relying on inventory sales. Lululemon's quick ratio fluctuates, with a sharp increase in January 2024 to 1.45, but generally hovering around 0.7-1.1 in other periods.
3. Cash Ratio: The cash ratio, which is the most conservative liquidity metric, reflects the company's ability to cover its current liabilities with its most liquid assets, cash, or cash equivalents. Lululemon's cash ratio improved from 0.90 in January 2022 to 1.08 in January 2025, indicating the company holds sufficient cash to meet short-term obligations.
Overall, Lululemon Athletica Inc. has shown consistent improvement in its liquidity position over the years, with increasing current ratios and generally healthy quick and cash ratios. This suggests that the company has a strong ability to meet its short-term financial commitments and indicates financial stability.
See also:
Additional liquidity measure
| Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Jan 28, 2024 | Oct 31, 2023 | Oct 29, 2023 | Jul 31, 2023 | Jul 30, 2023 | Apr 30, 2023 | Jan 31, 2023 | Jan 29, 2023 | Oct 31, 2022 | Oct 30, 2022 | Jul 31, 2022 | May 1, 2022 | Apr 30, 2022 | Jan 31, 2022 | Jan 30, 2022 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 121.92 | 156.90 | 95.09 | 89.70 | 76.30 | 64.55 | 112.87 | 98.11 | 128.03 | 119.57 | 170.26 | 130.69 | 134.63 | 141.64 | 268.24 | 140.36 | 81.74 | 122.58 | 83.71 | 67.19 |
The cash conversion cycle of Lululemon Athletica Inc. fluctuated over the years based on the provided data. The company's ability to convert its resources and investments in inventory into cash varied significantly.
In January 2022, the cash conversion cycle stood at 67.19 days, indicating efficient management of inventory and receivables. However, by April 2022, the cycle extended to 122.58 days, suggesting delays in converting inventory into cash and receiving payments from customers.
Throughout the following years, there were fluctuations in the cash conversion cycle, reaching a peak of 268.24 days in October 2022, which may indicate issues with inventory management or collection of receivables. Subsequently, there was a gradual improvement in the cycle, with a decrease to 64.55 days in January 2024.
Overall, Lululemon Athletica Inc. experienced varying levels of efficiency in converting its resources into cash over the years, with periods of both strong and weak performance. Monitoring and managing the cash conversion cycle is crucial for the company to optimize its working capital and overall financial health.