New York Times Company (NYT)

The liquidity ratios of New York Times Co. indicate the company's ability to meet its short-term obligations.

The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, has been fluctuating over the past five years. In 2023, the current ratio stands at 1.28, indicating that the company has $1.28 in current assets for every $1 in current liabilities. This suggests that the company may have improved its short-term liquidity compared to the previous year.

The quick ratio, also known as the acid-test ratio, provides a more conservative measure of liquidity by excluding inventory from current assets. The quick ratio has mirrored the trend of the current ratio over the years, with the 2023 ratio matching the current ratio of 1.28. This means that the company has sufficient liquid assets to cover its short-term liabilities without relying on inventory.

The cash ratio, which specifically focuses on the availability of cash and cash equivalents to cover current liabilities, has declined from 1.34 in 2020 to 0.88 in 2023. A cash ratio below 1 may indicate that the company may need to rely on other liquid assets or external financing to meet its short-term obligations.

Overall, while the current and quick ratios of New York Times Co. suggest a relatively stable short-term liquidity position, the decreasing trend in the cash ratio raises some concerns about the company's cash availability to meet immediate financial obligations.

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Additional liquidity measure

The cash conversion cycle of New York Times Co. has exhibited variability over the past five years. In 2023, the company's cash conversion cycle was 2.31 days, indicating that it took the company approximately 2.31 days to convert its investments in inventory and accounts receivable into cash. This represents an improvement from the negative cycle of -0.22 days in 2022, suggesting that the company was able to enhance its efficiency in managing its working capital.

Comparing these figures to previous years, it can be observed that in 2021 and 2020, the company had negative cash conversion cycles of -3.64 days and -9.22 days respectively, implying that during those periods, New York Times Co. was operating with an efficient cash conversion process. This trend is in stark contrast with the significantly positive cash conversion cycle of 517.57 days in 2019, indicating a substantial delay in converting investments into cash.

Overall, New York Times Co. has made progress in managing its cash conversion cycle, as reflected in the improving trend from negative to positive values in recent years. A positive cash conversion cycle indicates that the company is efficiently managing its working capital and turning its investments into cash relatively quickly.