Old Dominion Freight Line Inc (ODFL)

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 1.33 1.33 1.46 2.29 2.10 1.73 1.45 1.57 1.76 1.74 1.92 2.21 2.98 2.39 2.72 2.38 3.33 2.53 1.96 1.94
Quick ratio 1.18 1.18 1.28 2.15 1.93 1.58 1.24 1.43 1.59 1.61 1.79 2.11 2.83 2.28 2.59 2.27 3.18 2.42 1.85 1.83
Cash ratio 0.20 0.13 0.19 1.06 0.80 0.37 0.11 0.41 0.44 0.59 0.67 0.94 1.54 1.06 1.35 1.29 1.96 1.39 1.05 0.83

Old Dominion Freight Line Inc's liquidity ratios demonstrate the company's ability to meet its short-term obligations and manage its cash flow effectively.

The current ratio, which measures the company's ability to cover its current liabilities with its current assets, shows an overall improving trend from the first quarter of 2020 to the fourth quarter of 2024, with a peak of 3.33 in December 31, 2020. However, the current ratio has been fluctuating since then, indicating potential challenges in managing current liabilities relative to current assets.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, also displays a similar improving trend initially, reaching a high of 3.18 in December 31, 2020. Like the current ratio, the quick ratio shows some volatility in the later quarters, which may suggest the need for close monitoring of liquidity management.

Lastly, the cash ratio, which evaluates the company's ability to cover current liabilities using only its cash and cash equivalents, peaked at 1.96 in December 31, 2020. However, the cash ratio has experienced significant declines in subsequent quarters, indicating potential cash flow challenges or increased investment in other assets.

Overall, while Old Dominion Freight Line Inc has demonstrated strong liquidity positions at times, the fluctuations in these ratios in more recent periods may require the company to maintain a vigilant approach to managing its short-term liquidity needs.

See also:

Old Dominion Freight Line Inc Liquidity Ratios (Quarterly Data)

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 23.17 24.72 24.63 26.59 25.64 28.24 23.94 20.76 23.51 25.30 27.56 30.56 31.60 31.39 35.74 31.93 31.51 34.38 29.42 30.45

The cash conversion cycle of Old Dominion Freight Line Inc has shown fluctuations over the periods provided. The cycle represents the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales. A shorter cash conversion cycle is generally favorable as it indicates that the company is efficiently managing its working capital.

Looking at the data provided, we observe that Old Dominion Freight Line Inc's cash conversion cycle decreased from 30.45 days on March 31, 2020, to 23.17 days on December 31, 2024. This downward trend suggests that the company has been able to improve its efficiency in managing its working capital and converting its investments into cash more promptly.

It is worth noting that the company experienced some fluctuations in the cash conversion cycle during this period, with some peaks and troughs. For instance, there was a notable increase in the cycle from June 30, 2021, to September 30, 2021. However, the company managed to bring the cycle back down by December 31, 2021.

Overall, the decreasing trend in Old Dominion Freight Line Inc's cash conversion cycle is a positive indication of effective working capital management and efficient operations in converting resources into cash. This trend reflects the company's ability to optimize its cash flow and liquidity position, which can contribute to its financial stability and growth prospects.