National Presto Industries Inc (NPK)
Liquidity ratios
| Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 4.93 | 4.93 | 4.95 | 4.99 | 4.59 | 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 |
| Quick ratio | 0.30 | 0.30 | 0.47 | 0.79 | 1.19 | 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 |
| Cash ratio | 0.30 | 0.30 | 0.47 | 0.79 | 1.19 | 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 |
The current ratio of National Presto Industries Inc has shown a relatively stable trend over the past few years, ranging from a high of 7.18 to a low of 4.59. This indicates that the company has had a strong ability to cover its short-term liabilities with its current assets, with values consistently above 1, suggesting a healthy liquidity position.
The quick ratio, which excludes inventory from current assets, provides a more conservative measure of liquidity. It has shown some fluctuations but generally remained above 1, indicating the company's ability to meet its short-term obligations without relying on selling inventory.
The cash ratio, which is the most stringent liquidity ratio as it only considers cash and cash equivalents, has also been relatively stable over the years, demonstrating the company's ability to cover its short-term liabilities with its readily available cash resources.
Overall, National Presto Industries Inc's liquidity ratios reflect a solid financial position with adequate ability to meet its short-term obligations using its current assets, even when excluding inventory from the calculation.
Additional liquidity measure
| Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 290.63 | 326.88 | 335.66 | 297.52 | 271.11 | 253.81 | 225.25 | 216.66 | 209.71 | 208.37 | 258.99 | 209.28 | 197.63 | 180.21 | 191.06 | 183.36 | 183.39 | 184.73 | 189.52 | 196.38 |
The cash conversion cycle of National Presto Industries Inc has shown fluctuations over the analyzed period. The cycle measures the time it takes for the company to convert its investments in inventory and other resources into cash flows from sales.
From June 30, 2020, to December 31, 2021, the company managed to reduce its cash conversion cycle from 196.38 days to 180.21 days, indicating an improvement in efficiency in managing its working capital. However, from March 31, 2022, the cycle started increasing steadily, peaking at 335.66 days on September 30, 2024. This substantial increase could be a result of factors such as inefficient inventory management, extended accounts receivable collection periods, or delayed payment to suppliers.
Given the negative impact of an extended cash conversion cycle on a company's liquidity and profitability, National Presto Industries Inc should focus on optimizing its working capital management to shorten the cycle duration, aiming for a more efficient use of its resources and improved financial performance.