Vail Resorts Inc (MTN)

The liquidity ratios of Vail Resorts Inc, specifically the current ratio, quick ratio, and cash ratio, have fluctuated significantly over the past five years.

The current ratio, which measures the company's ability to meet short-term obligations with its current assets, has shown a downward trend from 1.78 in 2021 to 0.82 in 2024. This suggests that Vail Resorts Inc may be facing challenges in maintaining sufficient current assets to cover its current liabilities.

Similarly, the quick ratio, which provides a more conservative measure of liquidity by excluding inventory from current assets, also demonstrates a decreasing trend from 1.72 in 2021 to 0.63 in 2024. This indicates that the company may have a lower ability to meet its short-term obligations without relying on inventory.

The cash ratio, which measures the company's ability to cover its current liabilities with cash and cash equivalents, peaked at 1.37 in 2021 but has since declined to 0.29 in 2024. This decline suggests that Vail Resorts Inc may have less cash on hand relative to its current liabilities in recent years.

Overall, the downward trend in these liquidity ratios raises concerns about Vail Resorts Inc's ability to meet its short-term obligations effectively. It may be important for the company to closely monitor and manage its liquidity position to ensure financial stability and operational continuity.

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Additional liquidity measure

The cash conversion cycle for Vail Resorts Inc has fluctuated over the past five years. In the most recent fiscal year ending on July 31, 2024, the company's cash conversion cycle was 28.41 days, indicating that on average, it took Vail Resorts Inc 28.41 days to convert its investments in inventory and other resources into cash from sales.

Comparing this figure to previous years, we see that the cash conversion cycle was at its highest in July 2020, at 59.32 days, before decreasing in the following years. This improvement suggests that the company has become more efficient in managing its cash flow and working capital.

The significant decrease in the cash conversion cycle between 2021 and 2022, from 47.77 days to 15.20 days, indicates that Vail Resorts Inc was able to speed up its cash conversion process during that period. However, the increase to 34.00 days in 2023 followed by the subsequent decrease in 2024 to 28.41 days signals some variability in the company's cash conversion efficiency.

Overall, while Vail Resorts Inc has shown some fluctuations in its cash conversion cycle over the past five years, the recent trend of decreasing days indicates an improvement in the company's ability to efficiently manage its working capital and convert its investments into cash.