Power Integrations Inc (POWI)
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 | 9.29 | 10.01 | 9.95 | 10.14 | 10.47 | 10.41 | 8.50 | 8.55 | 8.99 | 8.70 | 6.86 | 8.56 | 9.50 | 10.65 | 9.78 | 10.27 | 9.62 | 8.95 | 8.91 | 10.29 |
| Quick ratio | 5.91 | 6.31 | 6.11 | 6.30 | 6.68 | 7.21 | 5.84 | 6.01 | 6.42 | 6.44 | 5.07 | 6.86 | 7.91 | 8.90 | 8.15 | 8.53 | 7.76 | 7.15 | 7.08 | 8.14 |
| Cash ratio | 5.42 | 5.98 | 5.78 | 6.05 | 6.38 | 6.68 | 5.34 | 5.69 | 6.06 | 6.17 | 4.67 | 6.41 | 7.33 | 8.31 | 7.55 | 7.86 | 7.18 | 6.70 | 6.89 | 7.76 |
The liquidity ratios of Power Integrations Inc show that the company has a strong ability to meet its short-term obligations. The current ratio, which measures the company's ability to pay off its current liabilities with its current assets, has remained consistently high over the years, ranging from 8.56 to 10.65. This indicates that Power Integrations has more than enough current assets to cover its short-term liabilities.
Additionally, the quick ratio, also known as the acid-test ratio, provides a more conservative measure of liquidity by excluding inventory from current assets. Power Integrations Inc also maintains a healthy quick ratio, ranging from 5.07 to 8.90, further demonstrating its strong liquidity position.
Furthermore, the cash ratio, which shows the proportion of a company's current assets held in cash or cash equivalents, has remained relatively stable between 4.67 and 8.31. This indicates that Power Integrations has a sufficient amount of cash on hand to meet its immediate obligations without relying on the sale of inventory or other current assets.
Overall, the consistently high current ratio, strong quick ratio, and stable cash ratio suggest that Power Integrations Inc is well-positioned to meet its short-term financial commitments and operates with a strong liquidity position.
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 | 278.92 | 285.79 | 283.99 | 257.99 | 243.62 | 215.09 | 190.01 | 167.23 | 146.94 | 116.32 | 93.18 | 88.70 | 80.65 | 76.05 | 79.21 | 95.94 | 128.51 | 123.35 | 112.50 | 117.21 |
The cash conversion cycle of Power Integrations Inc has shown fluctuations over the years. The company's cash conversion cycle measures the time it takes to convert its investments in inventory and other resources into cash flow from sales.
Analyzing the trend, we observe that the cash conversion cycle has generally been increasing, indicating that the company is taking longer to convert its investments into cash. This may suggest inefficiencies in managing inventory, collecting receivables, or paying payables.
In the most recent period, the cash conversion cycle reached its peak at 285.79 days as of September 30, 2024, reflecting a significant increase from the previous quarters. An extended cash conversion cycle can strain the company's liquidity and working capital management.
It is essential for Power Integrations Inc to closely monitor and optimize its cash conversion cycle to enhance operational efficiency and financial performance. Strategies such as improving inventory management, speeding up receivables collection, and negotiating favorable payment terms with suppliers could help reduce the cash conversion cycle and strengthen the company's financial position.