Mesa Laboratories Inc (MLAB)

Liquidity ratios

Mar 31, 2025 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 Sep 30, 2020 Jun 30, 2020
Current ratio — 0.71 0.70 1.94 2.47 2.68 2.96 2.93 2.74 2.74 2.80 2.90 2.59 2.59 11.13 9.43 9.30 10.64 14.34 13.17
Quick ratio — 0.45 0.42 1.19 1.52 1.50 1.85 1.77 1.74 1.69 1.85 1.94 1.88 1.90 10.49 8.86 8.83 9.88 13.34 12.16
Cash ratio — 0.20 0.16 0.55 0.64 0.69 0.93 0.86 0.76 0.67 0.85 0.99 1.03 1.11 9.70 8.24 8.10 9.14 12.39 11.28

The liquidity ratios of Mesa Laboratories Inc, as reflected in its current ratio, quick ratio, and cash ratio, indicate the company's ability to meet its short-term financial obligations.

- The current ratio, which measures the company's ability to pay off short-term liabilities with its current assets, has shown a declining trend from 13.17 in June 2020 to 1.94 in June 2024. While the ratio remained significantly above 1, indicating a healthy liquidity position, the recent decline raises concerns about the company's ability to cover immediate obligations.

- The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, followed a similar trend, declining from 12.16 in June 2020 to 0.45 in December 2024. This suggests that Mesa Laboratories may have difficulties meeting its short-term liabilities without relying on inventory.

- The cash ratio, which provides insight into the company's ability to cover its current liabilities with cash and cash equivalents, also decreased over time, indicating a reduction in the company's cash reserves relative to its short-term obligations.

Overall, the declining trend in Mesa Laboratories Inc's liquidity ratios raises concerns about its ability to maintain sufficient liquidity levels to meet its short-term financial commitments. Monitoring and improving liquidity management practices may be necessary to ensure the company's financial health and sustainability.

Additional liquidity measure

Mar 31, 2025 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 Sep 30, 2020 Jun 30, 2020
Cash conversion cycle days 63.57 149.19 155.93 160.18 175.89 199.97 183.42 186.84 192.75 185.07 149.65 162.76 162.68 172.93 111.38 112.99 116.57 117.63 121.72 123.96

The cash conversion cycle of Mesa Laboratories Inc has shown fluctuations over the years, reflecting the efficiency of the company in managing its working capital. The cycle represents the time it takes for the company to convert its investments in inventory and other resources into cash flow from sales.

From June 30, 2020, to March 31, 2025, the cash conversion cycle varied, ranging from a high of 199.97 days on December 31, 2023, to a low of 63.57 days on March 31, 2025. A lower cash conversion cycle is generally considered favorable as it indicates that the company is able to quickly convert its investments into cash.

The company experienced a significant increase in the cash conversion cycle from December 31, 2021, to March 31, 2022, indicating potential challenges in managing working capital efficiently during this period. However, there was a noticeable improvement in the cycle from June 30, 2023, to March 31, 2025, signaling better working capital management.

Analyzing the trend in Mesa Laboratories Inc's cash conversion cycle can provide insights into its liquidity, operational efficiency, and financial health. Overall, monitoring this metric over time can help assess the company's ability to efficiently manage its working capital and generate cash flow from its operations.