PVH Corp (PVH)

Based on the provided data, let's analyze the liquidity ratios of PVH Corp:

1. Current Ratio:
- The current ratio measures the company's ability to cover its short-term obligations with its current assets.
- PVH Corp's current ratio has been relatively stable over the years, ranging from 1.18 to 1.29.
- A current ratio above 1 indicates that the company has more current assets than current liabilities, suggesting good short-term financial strength.
- A current ratio of 1.27 as of February 28, 2025, indicates that PVH Corp is able to meet its short-term obligations comfortably.

2. Quick Ratio:
- The quick ratio, also known as the acid-test ratio, provides a more conservative measure of liquidity by excluding inventory from current assets.
- PVH Corp's quick ratio fluctuates, with values ranging from 0.20 to 0.54.
- A quick ratio below 1 indicates that the company may have difficulty meeting its short-term liabilities without relying on inventory sales.
- The quick ratio of 0.27 as of February 28, 2025, suggests that PVH Corp may face some challenges in meeting short-term obligations without relying on inventory.

3. Cash Ratio:
- The cash ratio is the most conservative liquidity ratio, focusing solely on cash and cash equivalents to cover current liabilities.
- PVH Corp's cash ratio has improved slightly over the years, ranging from 0.20 to 0.27.
- A higher cash ratio indicates a stronger ability to pay off short-term obligations immediately without relying on other current assets.
- With a cash ratio of 0.27 as of February 28, 2025, PVH Corp seems to have a healthy level of cash reserves to cover its immediate liabilities.

In conclusion, PVH Corp appears to have maintained a relatively stable current ratio, while the quick ratio and cash ratio show some fluctuations. The company's liquidity position seems adequate overall, with room for improvement in managing short-term obligations without relying heavily on inventory.

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Additional liquidity measure

The cash conversion cycle of PVH Corp has exhibited fluctuations over the periods analyzed. In January 2023, the company had a cash conversion cycle of 81.82 days, indicating a relatively efficient use of cash in the operating cycle. However, by February 2023, this cycle increased significantly to 168.65 days, suggesting a delay in converting investments in inventory into cash.

Subsequently, there was an improvement in the cash conversion cycle to 64.21 days in February 2024, reflecting a more efficient management of working capital. Nevertheless, by February 29, 2024, the cycle extended to 134.44 days, signifying a lengthened time required to convert inventory into sales.

In February 2025, the cash conversion cycle further increased to 156.87 days, indicating a potential liquidity strain or inefficiencies in the company's operations. Overall, the fluctuations in PVH Corp's cash conversion cycle demonstrate varying levels of effectiveness in managing cash flows, working capital, and the conversion of inventory into cash across different periods.