Mister Car Wash, Inc. Common Stock (MCW)

Liquidity ratios

	Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020
Current ratio	0.53	0.27	0.28	0.30	0.36	0.60	0.97	0.68	0.69	0.79	0.56	0.71	0.45	1.39	1.31	1.29	1.10
Quick ratio	0.36	0.09	0.02	0.06	0.11	0.36	0.73	0.46	0.42	0.54	0.30	0.52	0.15	1.19	1.12	1.11	0.93
Cash ratio	0.36	0.09	0.02	0.06	0.11	0.36	0.73	0.46	0.42	0.54	0.30	0.52	0.15	1.19	1.12	1.11	0.93

The liquidity ratios of Mister Car Wash, Inc. Common Stock provide insight into the company's ability to meet short-term obligations and manage its current assets effectively.

The current ratio, which measures the company's ability to cover short-term liabilities with its current assets, fluctuated over the years but generally remained above 1.0 until the end of 2021. However, from December 31, 2021, to June 30, 2024, the current ratio declined significantly, indicating potential liquidity challenges during this period.

The quick ratio, also known as the acid-test ratio, reflects the company's ability to meet immediate short-term obligations without relying on inventory. Similar to the current ratio, the quick ratio showed a declining trend from December 31, 2021, to December 31, 2024, indicating potential difficulties in meeting short-term liabilities using the most liquid assets.

The cash ratio, which focuses solely on the most liquid assets (cash and cash equivalents) compared to current liabilities, showed a similar trend to the quick ratio, with a significant decline from December 31, 2021, to December 31, 2024. This suggests that the company may have faced challenges in maintaining sufficient cash reserves to cover short-term obligations during this period.

Overall, the decreasing trend in liquidity ratios from 2021 to 2024 for Mister Car Wash, Inc. Common Stock raises concerns about its short-term financial health and ability to meet current liabilities, indicating a potential need for improved liquidity management strategies.

Additional liquidity measure

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020
Cash conversion cycle	days	5.81	5.27	6.10	8.50	10.76	12.21	11.13	11.13	12.47	12.23	9.95	9.16	8.72	8.06	9.67	11.89	12.07

The cash conversion cycle of Mister Car Wash, Inc. Common Stock has shown fluctuations over the different quarters analyzed. The cycle decreased from 12.07 days on December 31, 2020, to a low of 5.27 days on September 30, 2024. This indicates that the company was able to efficiently manage its cash flow and convert its investments in inventory back to cash at a quicker pace in the later periods.

Furthermore, the decrease in the cash conversion cycle suggests that Mister Car Wash, Inc. improved its efficiency in managing its working capital, including inventory turnover, accounts receivable collection, and accounts payable payment. This trend is positive as it indicates that the company was able to streamline its operations and generate cash more rapidly, potentially leading to improved liquidity and financial performance.

However, the slight increase in the cash conversion cycle observed in the most recent quarter on December 31, 2024, compared to the preceding quarters may warrant further investigation into the reasons behind this change. It is essential for the company's management to continually monitor and manage the cash conversion cycle to ensure optimal working capital management and sustainable financial health.