Mattel Inc (MAT)

Based on the data provided, we can analyze the liquidity ratios of Mattel Inc over the past five years.

1. Current Ratio:
- The current ratio measures the company's ability to pay off its short-term liabilities with its current assets.
- Mattel's current ratio has been relatively stable over the past five years, ranging from 1.76 to 2.33.
- The current ratio has shown an increasing trend from 2019 to 2023, indicating an improvement in the company's short-term liquidity position.
- A current ratio above 1 indicates that the company has more current assets than current liabilities, which is generally considered a positive sign.

2. Quick Ratio:
- The quick ratio, also known as the acid-test ratio, is a more stringent measure of liquidity, excluding inventory from current assets.
- Mattel's quick ratio has shown fluctuations over the past five years, ranging from 1.13 to 1.75.
- The quick ratio has generally improved from 2019 to 2023, reflecting a better ability to meet short-term obligations without relying on inventory.
- A quick ratio above 1 indicates that the company can cover its short-term liabilities without relying on the sale of inventory.

3. Cash Ratio:
- The cash ratio measures the company's ability to cover its current liabilities with its cash and cash equivalents alone.
- Mattel's cash ratio has shown an increasing trend from 2019 to 2023, ranging from 0.46 to 0.94.
- The improvement in the cash ratio indicates that Mattel has been holding a higher level of cash and cash equivalents relative to its current liabilities.
- A cash ratio above 1 would indicate that the company's cash and cash equivalents alone are sufficient to cover its current liabilities.

In summary, Mattel Inc's liquidity ratios have generally shown improvement over the past five years, particularly in terms of the quick ratio and cash ratio. The increasing trend in these ratios suggests that the company has enhanced its ability to meet its short-term obligations and maintain a stronger liquidity position.

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Additional liquidity measure

The Cash Conversion Cycle (CCC) of Mattel Inc has fluctuated slightly over the past five years. In 2020, the CCC was 89.17 days, which decreased to 82.19 days in 2019 before reaching a peak of 91.56 days in 2021. The CCC then decreased to 90.72 days in 2022 and further decreased to 83.58 days in 2023.

A lower CCC indicates that the company is able to efficiently convert its investments in inventory and other resources into cash, while a higher CCC suggests inefficiencies in managing working capital. Mattel's CCC trend reflects some variability in its working capital management over the years.

Overall, it is important for Mattel to focus on optimizing its cash conversion cycle to ensure effective management of its working capital, which can have a significant impact on the company's liquidity and overall financial performance.