La-Z-Boy Incorporated (LZB)

The liquidity ratios of La-Z-Boy Incorporated reflect its ability to meet short-term obligations and manage its current assets efficiently.

- The current ratio has shown a consistent improvement over the years, starting at 1.41 in April 2022 and reaching 1.91 in April 2024. This indicates that the company's current assets are sufficient to cover its current liabilities, with a higher ratio suggesting stronger liquidity.

- The quick ratio, also known as the acid-test ratio, shows a fluctuating trend within the observed period. It was relatively low at 0.39 in April 2022 but improved to 1.11 in April 2024. This ratio excludes inventory from current assets to provide a more conservative measure of liquidity.

- The cash ratio, which measures the company's ability to cover short-term liabilities using cash and cash equivalents, remained relatively stable around 0.74 to 0.80 between April 2022 and April 2024. This indicates that La-Z-Boy has a moderate level of cash reserves compared to its current liabilities.

Overall, the current and quick ratios have shown positive trends, indicating an improving liquidity position for La-Z-Boy Incorporated. However, the company may want to keep a close watch on its quick ratio to ensure it maintains a healthy level of liquid assets to meet its short-term obligations effectively.

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Additional liquidity measure

The cash conversion cycle of La-Z-Boy Incorporated has shown some fluctuations over the years based on the data provided. Starting from April 30, 2022, where it stood at 76.81 days, it decreased to 64.00 days by April 29, 2023. However, by the end of April 30, 2023, it increased slightly to 75.21 days. The cycle then rose further to 77.05 days by April 27, 2024, and notably peaked at 82.45 days by April 30, 2024.

Overall, the trend in the cash conversion cycle indicates some variability in the company's efficiency in managing its working capital components, including accounts receivable, inventory, and accounts payable. A shorter cash conversion cycle is generally seen as favorable as it allows the company to generate cash more quickly from its operations. Conversely, a longer cycle may indicate inefficiencies and tied-up capital in the operating cycle, potentially impacting the company's liquidity and overall financial performance.