Perdoceo Education Corp (PRDO)
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 | 4.84 | 5.48 | 5.43 | 4.95 | 5.90 | 4.81 | 4.00 | 4.33 | 3.52 | 4.15 | 5.19 | 5.04 | 3.95 | 4.00 | 4.66 | 4.90 | 4.50 | 4.23 | 3.57 | 3.60 |
| Quick ratio | 8.78 | 5.11 | 5.00 | 4.50 | 5.43 | 4.27 | 3.54 | 3.78 | 3.11 | 3.72 | 4.68 | 4.51 | 3.52 | 3.54 | 4.05 | 4.33 | 3.91 | 3.69 | 3.10 | 3.05 |
| Cash ratio | 8.78 | 5.11 | 5.00 | 4.50 | 5.43 | 4.27 | 3.54 | 3.78 | 3.11 | 3.72 | 4.68 | 4.51 | 3.52 | 3.54 | 4.05 | 4.33 | 3.91 | 3.69 | 3.10 | 3.05 |
Perdoceo Education Corp's liquidity ratios show a strong position over the period analyzed. The current ratio, which measures the company's ability to cover its short-term liabilities with current assets, has consistently remained above 3.5, with an increasing trend from 2020 to 2024. This indicates the company has more than enough current assets to meet its short-term obligations.
The quick ratio, known as the acid-test ratio, provides a stricter assessment of liquidity by excluding inventory from current assets. Perdoceo Education Corp's quick ratio has also shown a positive trend, staying comfortably above 3.0 and peaking at 8.78 by December 31, 2024. This signifies the company's strong ability to cover its short-term liabilities with its most liquid assets.
The cash ratio, a more stringent measure of liquidity that focuses solely on cash and cash equivalents to cover short-term liabilities, mirrors the positive performance seen in the current and quick ratios. The company's cash ratio has remained stable and robust throughout the period, indicating Perdoceo Education Corp maintains a healthy level of readily available cash to manage its immediate financial obligations.
Overall, based on the current, quick, and cash ratios, Perdoceo Education Corp demonstrates a solid liquidity position, with ample resources to meet its short-term financial commitments and navigate unforeseen cash flow challenges. This suggests the company is well-prepared to address any liquidity needs that may arise in the near term.
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 | 10.23 | 12.19 | 13.46 | 12.28 | 14.01 | 6.07 | 8.20 | 11.22 | 5.95 | 6.72 | 4.00 | 4.75 | 3.03 | 3.84 | 1.99 | 1.90 | 1.95 | 2.08 | 1.97 | 1.97 |
Perdoceo Education Corp's cash conversion cycle, a measure of how long it takes a company to convert its investments in inventory and other resources into cash flows from sales, has shown fluctuations over the past few quarters.
From March 31, 2020, to December 31, 2021, the company's cash conversion cycle remained relatively stable, hovering around the 2-day mark. This may indicate efficient management of working capital during this period.
However, starting from March 31, 2022, the cash conversion cycle began to increase significantly, reaching a peak of 14.01 days by December 31, 2023. This prolonged cycle suggests that Perdoceo Education Corp may be facing challenges in converting its investments into cash efficiently, potentially due to issues such as slower inventory turnover or delayed accounts receivable collection.
Although there was a slight decrease in the cash conversion cycle by June 30, 2024, it still remained elevated at 13.46 days, indicating that the company may need to focus on improving its working capital management to enhance liquidity and operational efficiency in the future. Further monitoring of the cash conversion cycle will be essential to assess the company's ability to manage its working capital effectively.