ePlus inc (PLUS)

ePlus inc has shown generally satisfactory liquidity ratios over the past five years.

1. Current Ratio: ePlus inc's current ratio has been relatively stable, ranging from 1.69 to 1.95, indicating the company's ability to cover its short-term obligations with current assets. A current ratio above 1 suggests the company has more current assets than current liabilities.

2. Quick Ratio: The quick ratio, also known as the acid-test ratio, assesses the company's ability to meet short-term obligations with its most liquid assets. ePlus inc's quick ratio has fluctuated between 1.12 and 1.59 over the past five years, which suggests that the company has an acceptable level of quick assets to cover immediate liabilities without relying on inventory.

3. Cash Ratio: The cash ratio measures the company's ability to cover its current liabilities with its cash and cash equivalents alone. ePlus inc's cash ratio has ranged from 0.18 to 0.49, indicating that the company has improved its ability to cover short-term liabilities with cash over the years.

Overall, ePlus inc has maintained sound liquidity positions over the past five years, with current and quick ratios consistently above 1, indicating a healthy ability to meet its short-term financial obligations. Additionally, the increase in the cash ratio reflects an enhanced ability to cover immediate liabilities with cash reserves.

---

Additional liquidity measure

The cash conversion cycle of ePlus Inc has fluctuated over the past few years. As of March 31, 2021, the company's cash conversion cycle was 95.84 days, indicating that it took ePlus approximately 96 days to convert its investments in inventory and receivables into cash.

By March 31, 2022, the cash conversion cycle increased to 113.42 days, suggesting a longer time period required to convert these assets into cash. The trend continued in March 31, 2023, with the cycle extending to 120.09 days, indicating a further delay in the cash conversion process.

However, by March 31, 2024, there was a notable improvement as the cash conversion cycle decreased to 91.89 days, reflecting a more efficient turnaround time for converting assets into cash.

The most significant improvement was seen by March 31, 2025, with the cash conversion cycle dramatically reduced to 8.86 days, indicating a remarkable enhancement in ePlus Inc's efficiency in managing its working capital.

Overall, it is evident that ePlus Inc has made efforts to optimize its cash conversion cycle, with fluctuations indicating varying levels of operational efficiency and effectiveness in managing working capital over the years. This ongoing focus on streamlining the cash conversion cycle can positively impact liquidity and overall financial performance.