Mueller Water Products (MWA)
Quick ratio
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 309,900 | 160,300 | 146,500 | 227,500 | 208,900 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | 215,500 | 221,800 | 232,700 | 223,900 | 180,800 |
| Total current liabilities | US$ in thousands | 258,000 | 218,800 | 241,000 | 220,100 | 155,000 |
| Quick ratio | 2.04 | 1.75 | 1.57 | 2.05 | 2.51 |
September 30, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($309,900K
+ $—K
+ $215,500K)
÷ $258,000K
= 2.04
The analysis of Mueller Water Products' quick ratio over the specified period reveals several notable trends. As of September 30, 2020, the quick ratio stood at 2.51, indicating that the company held more than twice its current liabilities in liquid assets, reflecting strong short-term liquidity. By September 30, 2021, the ratio declined to 2.05, suggesting a reduction in liquid assets relative to current liabilities but still maintaining a comfortable liquidity cushion.
The downward trend continued appreciably, with the quick ratio decreasing to 1.57 as of September 30, 2022. This reduction implies a further tightening of liquidity, possibly driven by increased current liabilities or a decrease in liquid assets such as cash and receivables. Despite this decline, the ratio remained above 1, indicating that the company still possessed sufficient liquid assets to cover its immediate obligations without reliance on inventory sales.
Following this period of decline, an improvement was observed as of September 30, 2023, when the quick ratio increased to 1.75. This rise suggests a positive adjustment in liquidity position, possibly due to better management of liquid assets or a reduction in short-term liabilities. The ratio further increased to 2.04 by September 30, 2024, reflecting a resurgence toward the higher levels observed in 2020, and indicating a restored or enhanced liquidity position.
Overall, the trend demonstrates that Mueller Water Products experienced a significant reduction in short-term liquidity from 2020 to 2022, followed by a recovery and strengthening of liquidity metrics in subsequent years. The fluctuations in the quick ratio highlight periods of tightening and subsequent improvement in the company's ability to meet its short-term obligations with its most liquid assets.
Peer comparison
Sep 30, 2024