Middleby Corp (MIDD)

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 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Current ratio 2.31 2.27 2.32 2.08 2.03 2.08 1.98 1.99 1.87 1.83 2.09 1.95 1.81 2.08 3.27 2.48 2.04 2.05 2.10 1.98
Quick ratio 1.05 0.93 0.92 0.17 0.81 0.15 0.17 0.16 0.83 0.31 0.54 0.43 0.38 0.37 1.29 0.63 0.16 0.15 0.14 0.14
Cash ratio 0.29 0.20 0.19 0.17 0.17 0.15 0.17 0.16 0.20 0.31 0.54 0.43 0.38 0.37 1.29 0.63 0.16 0.15 0.14 0.14

Middleby Corp's liquidity position, as reflected in its current ratio, has been relatively stable over the past five quarters, ranging from 1.83 to 2.32. The current ratio measures the company's ability to cover its short-term obligations with its current assets. A current ratio above 1 indicates that the company has more current assets than current liabilities, which is generally considered a good indicator of liquidity.

The quick ratio, however, shows a wider fluctuation, ranging from 0.15 to 1.29. This ratio is a more stringent measure of liquidity as it excludes inventories from current assets, focusing only on the most liquid assets like cash and accounts receivable. A quick ratio below 1 may indicate potential difficulties in meeting short-term obligations without relying on inventory sales.

The cash ratio, which specifically looks at the company's ability to cover its current liabilities with its cash and cash equivalents, has also shown variability, ranging from 0.14 to 0.63. This ratio provides insight into the company's immediate liquidity position and ability to pay off its current debts with cash on hand.

Overall, Middleby Corp's liquidity ratios suggest that while the company generally maintains a healthy current ratio, its quick ratio and cash ratio show more variability and may warrant closer monitoring to ensure the company has enough readily accessible funds to meet its short-term obligations.

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 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Cash conversion cycle days 138.06 147.13 153.86 95.09 141.31 86.85 77.50 73.97 134.06 58.06 54.77 56.59 57.73 65.15 75.88 62.80 59.58 62.98 60.84 57.57

The cash conversion cycle of Middleby Corp has exhibited fluctuations over the past few quarters. The cycle represents the time taken by the company to convert its investments in raw materials and other resources into cash from sales to customers. A longer cash conversion cycle may indicate inefficiencies in managing the company's working capital.

In the latest quarter, ending December 31, 2023, Middleby Corp's cash conversion cycle was 138.06 days, indicating a slight improvement compared to the previous quarter. However, it is still higher compared to the same quarter in the previous year. This suggests that the company may be taking longer to convert its investments into cash, potentially tying up more capital in operations.

Analyzing the trend over the past few quarters, Middleby Corp experienced its shortest cash conversion cycle in the second quarter of 2022, at 54.77 days, indicating efficient management of working capital and quicker conversion of investments into cash. However, this was followed by an increase in the cycle in subsequent quarters, which peaked in the third quarter of 2023 at 147.13 days.

Overall, Middleby Corp may need to focus on optimizing its operational efficiency and working capital management to reduce its cash conversion cycle and improve its cash flow generation. Efforts to streamline processes, manage inventory levels effectively, and negotiate favorable payment terms with suppliers and customers could help in achieving a more favorable cash conversion cycle in the future.