Mister Car Wash Inc (MCW)
Liquidity ratios
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 0.36 | 0.60 | 0.97 | 0.68 | 0.69 | 0.79 | 0.56 | 0.71 | 0.45 | 1.39 | 1.31 |
| Quick ratio | 0.24 | 0.47 | 0.86 | 0.55 | 0.55 | 0.66 | 0.42 | 0.59 | 0.33 | 1.25 | 1.18 |
| Cash ratio | 0.11 | 0.36 | 0.73 | 0.46 | 0.42 | 0.54 | 0.30 | 0.50 | 0.15 | 1.19 | 1.12 |
The liquidity ratios of Mister Car Wash Inc have fluctuated over the past five quarters. The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, has been inconsistent, ranging from a low of 0.36 in Q4 2023 to a high of 0.97 in Q2 2023. Generally, a current ratio below 1 indicates potential liquidity concerns.
The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, also shows variability, with values ranging from 0.31 to 0.93 over the same period. This ratio suggests the company may struggle to meet its short-term obligations without relying on inventory.
Furthermore, the cash ratio, which assesses the company's ability to cover its current liabilities with its cash and cash equivalents, has exhibited a similar pattern of fluctuation. Values have ranged from 0.18 to 0.79, indicating potential challenges in meeting immediate payment obligations solely with cash on hand.
Overall, the downward trend in liquidity ratios, particularly the current and quick ratios, warrants further examination to determine the effectiveness of Mister Car Wash Inc's current liquidity management strategies and potential risks to its short-term financial health.
Additional liquidity measure
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | ||
|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | -50.06 | -55.16 | -60.06 | -50.58 | -35.05 | -40.61 | -40.99 | -25.81 |
The cash conversion cycle of Mister Car Wash Inc has exhibited fluctuations over the five quarters presented. The company's cash conversion cycle was negative in all quarters, indicating efficient management of its working capital. It decreased from -14.44 days in Q4 2022 to -27.48 days in Q2 2023, indicating a longer cash conversion cycle during that period. However, in Q4 2023, the cycle improved to -23.98 days, suggesting a more efficient conversion of inventory and receivables into cash. Overall, despite some variability, the company maintained a negative cash conversion cycle, indicating strong liquidity and effective management of operating cash flows.