National Presto Industries Inc (NPK)
Liquidity ratios
| 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 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 5.00 | 5.26 | 5.65 | 5.54 | 6.09 | 6.52 | 6.72 | 6.39 | 6.55 | 5.64 | 7.04 | 6.20 | 6.48 | 7.18 | 5.97 | 6.78 | 8.60 | 7.23 | 7.59 | 7.29 |
| Quick ratio | 2.28 | 1.53 | 1.81 | 1.86 | 3.15 | 2.04 | 2.28 | 2.37 | 3.76 | 2.03 | 2.51 | 2.27 | 2.81 | 2.65 | 2.37 | 2.76 | 4.18 | 3.33 | 3.68 | 3.75 |
| Cash ratio | 1.58 | 1.50 | 1.77 | 1.86 | 1.78 | 2.04 | 2.28 | 2.37 | 2.71 | 2.03 | 2.51 | 2.27 | 2.81 | 2.65 | 2.37 | 2.76 | 4.18 | 3.33 | 3.68 | 3.75 |
National Presto Industries Inc has consistently maintained a strong liquidity position based on its current ratio, which has remained above 5 over the past few quarters. This indicates that the company has ample current assets to cover its current liabilities. The current ratio has shown some fluctuations, with a slight decline in recent quarters but still at a healthy level.
The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has also generally remained above 1, signaling that National Presto Industries Inc has a solid ability to meet its short-term obligations without relying heavily on inventory.
Furthermore, the cash ratio, which measures the company's ability to cover its current liabilities with cash and cash equivalents, has been consistently above 1, indicating that the company has sufficient liquid assets to cover its short-term liabilities without relying on the sale of inventory.
Overall, the liquidity ratios of National Presto Industries Inc suggest that the company is well-positioned to meet its short-term financial obligations and has a strong financial footing.
Additional liquidity measure
| 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 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 257.05 | 172.27 | 169.47 | 156.47 | 251.86 | 213.59 | 172.02 | 158.94 | 196.32 | 138.00 | 149.57 | 147.41 | 139.09 | 149.29 | 150.15 | 161.67 | 164.90 | 169.92 | 131.30 | 110.98 |
The cash conversion cycle for National Presto Industries Inc fluctuated over the given periods, indicating variations in the company's efficiency in managing its working capital. The cycle represents the time taken by the company to convert its investments in raw materials into cash from sales of finished goods. A shorter cash conversion cycle is generally favorable as it signifies that the company is able to efficiently convert its resources into cash.
Looking at the data, we observe that the cash conversion cycle ranged from a low of 110.98 days in Sep 2019 to a high of 257.05 days in Dec 2023. This wide range suggests fluctuations in the company's operational efficiency and effectiveness in managing its accounts receivable, inventory, and accounts payable.
The cycle peaked in Dec 2023 at 257.05 days, indicating the company took an extended period to convert its investments into cash during that quarter. This could be due to factors such as a slowdown in sales, challenges in managing inventory levels, or delays in collecting receivables. Conversely, the cycle hit a low of 110.98 days in Sep 2019, reflecting improved efficiency in working capital management during that period.
It is important for National Presto Industries Inc to closely monitor its cash conversion cycle and strive to optimize it by streamlining processes, improving inventory turnover, and managing cash flow effectively. By enhancing efficiency in converting investments into cash, the company can strengthen its financial performance and liquidity position in the long run.