Neogen Corporation (NEOG)

Liquidity ratios

Aug 31, 2024 Feb 29, 2024 Nov 30, 2023 Aug 31, 2023 May 31, 2023 Feb 28, 2023 Nov 30, 2022 Aug 31, 2022 May 31, 2022 Feb 28, 2022 Nov 30, 2021 Aug 31, 2021 May 31, 2021 Feb 28, 2021 Nov 30, 2020 Aug 31, 2020 May 31, 2020 Feb 29, 2020 Nov 30, 2019 Aug 31, 2019
Current ratio 4.41 3.82 3.54 4.23 4.03 5.18 4.22 9.07 8.05 9.28 9.75 12.00 11.03 12.09 12.97 11.99 11.08 13.16 12.89 11.71
Quick ratio 2.35 2.17 2.16 2.73 2.74 3.08 2.75 6.58 10.50 12.28 13.08 16.11 14.52 15.68 16.77 16.19 14.56 10.44 10.29 9.16
Cash ratio 0.98 1.07 1.30 1.73 1.69 1.71 1.81 5.19 9.22 10.87 11.61 14.39 12.81 13.78 14.97 14.51 12.81 8.38 8.08 7.20

Neogen Corporation has demonstrated strong liquidity positions over the past quarters based on its liquidity ratios. The current ratio has remained consistently high, ranging from 3.54 to 12.97, indicating the company's ability to cover its short-term obligations with its current assets. This suggests that Neogen has a comfortable buffer to meet its immediate financial commitments.

The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has also shown a healthy trend. Neogen's quick ratio has ranged from 2.16 to 16.77, reflecting a strong ability to meet short-term obligations without relying on inventory liquidation.

Furthermore, the cash ratio, which measures the company's ability to cover its current liabilities with its cash and cash equivalents, has consistently remained at healthy levels. Neogen's cash ratio has ranged from 0.98 to 14.97, indicating a robust cash position relative to its short-term obligations.

Overall, Neogen Corporation's liquidity ratios suggest that the company is well-positioned to meet its short-term financial obligations and has a strong ability to weather potential financial challenges.


Additional liquidity measure

Aug 31, 2024 Feb 29, 2024 Nov 30, 2023 Aug 31, 2023 May 31, 2023 Feb 28, 2023 Nov 30, 2022 Aug 31, 2022 May 31, 2022 Feb 28, 2022 Nov 30, 2021 Aug 31, 2021 May 31, 2021 Feb 28, 2021 Nov 30, 2020 Aug 31, 2020 May 31, 2020 Feb 29, 2020 Nov 30, 2019 Aug 31, 2019
Cash conversion cycle days 89.67 71.11 49.78 47.95 60.24 80.20 75.76 109.17 103.58 111.13 106.81 115.67 120.64 122.27 112.18 116.41 115.95 114.40 114.07 113.65

The cash conversion cycle of Neogen Corporation has displayed fluctuations over the past few periods. The cycle represents the time it takes for the company to convert its investments in inventory and other resources into cash collected from customers.

The trend in the cash conversion cycle indicates the efficiency of Neogen Corporation's operations in managing its working capital. A lower cash conversion cycle is generally preferable as it signifies that the company is able to quickly sell its inventory, collect revenues, and convert them into cash.

In analyzing the data provided, we observe that the cash conversion cycle ranged from 47.95 days to 122.27 days over the specified periods. The lowest cycle of 47.95 days in August 31, 2023, suggests that Neogen Corporation was efficiently managing its inventory and accounts receivable during that period. However, the highest cycle of 122.27 days in February 28, 2021, indicates potential inefficiencies in working capital management.

The fluctuations in the cash conversion cycle may be influenced by various factors such as changes in sales volumes, inventory management practices, payment terms with suppliers, and collections from customers. It is important for Neogen Corporation to closely monitor its cash conversion cycle to ensure optimal cash flow management and overall operational efficiency.