Movado Group Inc (MOV)

Movado Group Inc's liquidity ratios have shown consistent improvement over the past five years.

The current ratio, which measures the company's ability to cover its short-term liabilities with its short-term assets, has steadily increased from 4.25 in 2020 to 4.81 in 2024. This indicates that Movado Group Inc has a strong ability to meet its short-term obligations using its current assets.

The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity as it excludes inventory from current assets. Movado Group Inc's quick ratio has also improved over the years, from 2.42 in 2020 to 3.35 in 2024. This demonstrates the company's improved ability to meet its short-term obligations without relying on inventory.

The cash ratio, which is the most stringent measure of liquidity as it only considers cash and cash equivalents, has shown a similar trend of improvement. Movado Group Inc's cash ratio increased from 1.70 in 2020 to 2.32 in 2024, signifying the company's enhanced ability to cover its short-term liabilities with its cash reserves.

Overall, Movado Group Inc's liquidity ratios indicate a strong financial position with sufficient liquidity to meet its short-term obligations. The company's consistent improvement in liquidity ratios over the years suggests effective management of working capital and financial resources.

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Additional liquidity measure

Movado Group Inc's cash conversion cycle has fluctuated over the past five years. The cash conversion cycle indicates the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.

In 2024, the cash conversion cycle stood at 130.01 days, showing an improvement compared to the previous year. This suggests that Movado Group Inc has become more efficient in managing its working capital and converting its assets into cash.

In 2023, the cash conversion cycle was 138.68 days, indicating a longer period compared to 2024. This could be a signal that the company faced challenges in managing its inventory, receivables, and payables efficiently.

In 2022, the cash conversion cycle was 116.06 days, showing a shorter period than the previous year. This indicates that Movado Group Inc improved its working capital management and cash conversion efficiency.

In 2021, the cash conversion cycle increased to 140.58 days, which is higher than in 2022. This may suggest that the company faced difficulties in managing its working capital effectively during that period.

In 2020, the cash conversion cycle stood at 114.52 days, indicating a shorter period compared to 2021. This improvement suggests that Movado Group Inc successfully managed its working capital and cash conversion processes.

Overall, through the analysis of Movado Group Inc's cash conversion cycle over the past five years, we can observe fluctuations in efficiency in converting investments into cash flows from sales. Trends in the cash conversion cycle can provide insights into the company's working capital management and operational efficiency.