Mednax Inc (MD)

Pediatrix Medical Group Inc's liquidity ratios provide insight into its ability to meet its short-term obligations. The current ratio, which measures the company's ability to pay off its current liabilities with its current assets, shows a fluctuating trend over the past five years. The ratio improved from 1.00 in 2022 to 1.24 in 2023, indicating a better ability to cover short-term obligations.

Similarly, the quick ratio, which excludes inventory from current assets in the calculation, also reflects the company's liquidity position. Pediatrix Medical Group Inc's quick ratio shows the same trend as the current ratio, aligning at 1.24 in 2023. This ratio provides a more stringent measure of liquidity as it eliminates less liquid assets from the calculation.

The cash ratio, which is the most conservative measure of liquidity, focuses solely on the cash and cash equivalents available to cover current liabilities. Pediatrix Medical Group Inc's cash ratio increased from 0.31 in 2022 to 0.52 in 2023, indicating a stronger position in terms of its ability to meet short-term obligations with cash on hand.

Overall, while the current and quick ratios demonstrate varying levels of liquidity for Pediatrix Medical Group Inc, the cash ratio portrays a more conservative evaluation of the company's financial health. Investors and analysts may view these liquidity ratios in conjunction with other financial metrics to gauge the company's overall ability to manage its short-term financial commitments.

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Additional liquidity measure

The cash conversion cycle of Pediatrix Medical Group Inc has shown variability over the past five years. In 2023, the company's cash conversion cycle decreased to 51.21 days compared to 54.93 days in 2022 and 60.35 days in 2021. This improvement suggests that the company is managing its cash flow more efficiently by reducing the time it takes to convert its investments in inventory and other resources into cash inflows from sales.

Comparing 2023 to 2020 and 2019, the cash conversion cycle was somewhat similar, indicating relative stability in the company's cash management practices during these years. Overall, a shorter cash conversion cycle is generally favorable as it signifies that the company is able to collect cash from its customers faster and manage its working capital efficiently.

In conclusion, Pediatrix Medical Group Inc's decreasing trend in the cash conversion cycle from 2021 to 2023 indicates an improvement in its cash flow management, which could potentially lead to better liquidity and financial performance in the future.