PulteGroup Inc (PHM)

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 14.32 0.42 0.43 0.53 15.41 0.62 0.60 0.43 12.02 0.07 0.25 0.36 20.34 0.57 0.64 0.67 30.56 0.99 0.80 0.84
Quick ratio 19.91 0.59 0.61 0.71 19.82 0.76 0.75 0.57 19.76 0.07 0.46 0.52 31.17 0.78 0.86 0.88 37.24 1.18 0.99 1.01
Cash ratio 19.91 0.59 0.61 0.71 19.82 0.76 0.75 0.57 19.76 0.07 0.46 0.52 31.17 0.78 0.86 0.88 37.24 1.18 0.99 1.01

PulteGroup Inc's liquidity ratios provide insights into 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, deteriorated significantly from 2020 to 2022 before showing some improvement by the end of 2024. The ratio dropped from 0.84 in March 2020 to 0.07 in September 2022, signaling potential liquidity challenges during that period. However, there was a recovery to 0.43 by March 2024, indicating a better ability to meet short-term obligations.

The quick ratio, which excludes inventory from current assets to provide a more conservative measure of liquidity, followed a similar trend as the current ratio. It decreased from 1.01 in March 2020 to 0.07 in September 2022 before rebounding to 0.59 by December 2024. This pattern suggests that the company's short-term liquidity position was under pressure during the middle of the observation period but improved towards the end.

The cash ratio, which is the most stringent measure of liquidity as it considers only cash and cash equivalents to cover current liabilities, exhibited a comparable trajectory to the current and quick ratios over the analyzed period. It declined from 1.01 in March 2020 to 0.07 in September 2022 before rising to 0.59 by December 2024. This progression indicates fluctuations in PulteGroup Inc's liquidity position, with potential liquidity strains in the mid-2020s subsequently mitigated by improved liquidity levels towards the end of 2024.

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 3,208.96 1,904.23 2,226.93 2,599.49 0.00 582.33 927.18 2,661.37 2,658.12 2,936.21 2,778.36 2,699.58 2,588.15 2,677.88 2,623.19 2,642.97 2,504.58 2,531.63 2,472.36 2,447.31

The cash conversion cycle of PulteGroup Inc has fluctuated over the years based on the data provided. The cash conversion cycle represents the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.

From March 31, 2020, to June 30, 2021, PulteGroup's cash conversion cycle ranged from around 2,447 to 2,623 days, indicating a relatively stable cycle over this period. However, from September 30, 2021, to September 30, 2022, there was a noticeable increase in the cash conversion cycle, reaching a peak of 2,936 days, which suggests the company may have faced challenges in efficiently converting its resources into cash during this period.

The cash conversion cycle then decreased significantly by December 31, 2023, reaching 0 days, which may indicate an improvement in the company's cash management and efficiency in generating cash flows from sales. However, the cycle increased again by December 31, 2024, to 3,208 days, implying potential delays in converting investments into cash, which could be a point of concern for investors and stakeholders.

Overall, it appears that PulteGroup Inc has experienced fluctuations in its cash conversion cycle, indicating changes in its operational efficiency and liquidity management strategies. Further analysis would be required to understand the specific factors influencing these variations and to assess the company's ability to effectively manage its working capital and cash flow.