Insperity Inc (NSP)
Liquidity ratios
| 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 | Mar 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.08 | 1.16 | 1.17 | 1.15 | 1.11 | 1.12 | 1.20 | 1.17 | 1.12 | 1.15 | 1.13 | 1.11 | 1.10 | 1.20 | 1.20 | 1.20 | 1.19 | 1.25 | 1.27 | 1.21 |
| Quick ratio | 1.04 | 0.48 | 0.61 | 0.57 | 1.06 | 0.60 | 0.64 | 1.07 | 1.07 | 1.07 | 1.02 | 1.00 | 1.07 | 1.13 | 1.13 | 1.09 | 1.14 | 1.16 | 1.20 | 1.09 |
| Cash ratio | 0.61 | 0.48 | 0.61 | 0.57 | 0.58 | 0.60 | 0.63 | 0.60 | 0.61 | 0.57 | 0.47 | 0.48 | 0.62 | 0.55 | 0.54 | 0.55 | 0.70 | 0.53 | 0.64 | 0.50 |
Insperity Inc's liquidity ratios reflect its ability to meet short-term obligations effectively. The current ratio, which compares current assets to current liabilities, has been fluctuating over the years but generally remains above 1. This indicates that the company has sufficient current assets to cover its current liabilities.
The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. The trend shows a decline in the quick ratio towards the end of the period, potentially signaling a reduced ability to meet immediate obligations without relying on inventory.
The cash ratio, which measures a company's ability to cover its current liabilities with cash and cash equivalents, demonstrates a relatively stable but moderate level of liquidity throughout the period. The ratios consistently stay above 0.5, indicating that Insperity has a reasonable amount of cash on hand to meet its short-term obligations.
Overall, while the current ratio suggests adequate liquidity, the downward trend in the quick ratio and occasional fluctuations in the cash ratio may require closer monitoring to ensure Insperity's continued ability to meet its short-term financial obligations.
Additional liquidity measure
| 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 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 35.64 | -6.47 | -7.87 | 106.25 | 103.24 | 79.56 | 78.85 | 150.47 | 108.45 | 140.37 | 187.56 | 142.62 | 121.03 | 149.90 | 152.90 | 230.33 | 124.38 | 180.75 | 158.33 | 196.32 |
Insperity Inc's cash conversion cycle measures the time it takes for the company to convert its investments in inventory and accounts receivable into cash. Analyzing the data provided, we can observe significant fluctuations in the cash conversion cycle over the periods indicated. For instance:
- As of March 31, 2020, the company's cash conversion cycle was 196.32 days, highlighting a relatively lengthy cycle.
- By December 31, 2021, the cycle had improved significantly to 121.03 days, indicating a faster conversion of assets into cash.
- The cycle continued to decline further to 78.85 days by June 30, 2023, reflecting a more efficient working capital management.
- However, the cycle turned negative by June 30, 2024, indicating that Insperity Inc was able to convert its investments into cash in a shorter period than the time it took to pay off its current liabilities.
This trend suggests that the company made substantial improvements in managing its working capital efficiency from 2020 to 2024. The negative cash conversion cycle by mid-2024 may indicate that Insperity Inc could be effectively managing its cash flows, inventory, and accounts receivable to drive operational efficiency and possibly optimize its liquidity position.