Ralph Lauren Corp Class A (RL)

Liquidity ratios

Mar 31, 2025 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
Current ratio 1.78 1.76 1.72 2.19 2.29 2.17 2.11 2.18 2.23 2.08 2.01 2.05 1.87 1.88 2.05 2.07 2.66 2.55 2.51 2.59
Quick ratio 1.19 1.22 1.12 1.43 1.60 1.46 1.28 1.34 1.38 1.24 1.20 1.30 1.36 1.45 1.56 1.64 2.07 1.97 1.80 1.94
Cash ratio 0.98 0.96 0.81 1.12 1.22 1.14 0.91 1.05 1.05 0.97 0.83 1.02 1.15 1.23 1.35 1.40 1.75 1.66 1.57 1.82

The current ratio for Ralph Lauren Corp Class A has shown fluctuation over the analyzed period, ranging from a high of 2.66 in March 2021 to a low of 1.72 in September 30, 2024. Generally, a current ratio above 1 indicates that the company can meet its short-term obligations. The current ratio has been above 2 for most quarters, indicating a strong ability to cover its short-term liabilities with current assets.

The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, also shows variability. It ranges from a high of 2.07 in March 31, 2021, to a low of 1.12 in September 30, 2024. The quick ratio generally provides a more conservative view of liquidity, and the company seems to have maintained a relatively healthy quick ratio above 1 throughout the period.

The cash ratio, which reflects the company's ability to cover its current liabilities with its most liquid assets, has also fluctuated. It ranges from a high of 1.82 in June 30, 2020, to a low of 0.81 in September 30, 2024. The cash ratio indicates the company's ability to cover its short-term liabilities with cash and cash equivalents alone, and a ratio above 1 suggests a strong liquidity position.

Overall, the liquidity ratios of Ralph Lauren Corp Class A indicate a generally stable and healthy liquidity position throughout the analyzed period, with the company able to meet its short-term obligations effectively using its current assets and cash reserves. However, the declining trend in some ratios towards the end of the period may warrant further monitoring to ensure continued financial health.

Additional liquidity measure

Mar 31, 2025 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
Cash conversion cycle days 107.90 114.15 140.28 120.66 125.46 132.79 151.77 145.88 140.35 152.25 161.20 132.41 120.70 115.59 121.49 121.68 137.54 155.63 144.79 119.49

The cash conversion cycle of Ralph Lauren Corp Class A has shown fluctuations over the past few years. Starting at 119.49 days on June 30, 2020, it increased to 155.63 days by December 31, 2020. However, the trend reversed in the following periods, indicating an improvement in cash collection efficiency. The cycle decreased to 115.59 days by December 31, 2021, and further declined to 107.90 days by March 31, 2025.

The company's ability to convert its resources invested in inventory and accounts receivable into cash within a shorter period is a positive sign. This suggests efficient management of working capital, potentially leading to improved liquidity and cash flow for the organization.

Moreover, the decreasing trend in the cash conversion cycle reflects potential enhancements in inventory management and accounts receivable collection processes. However, the increase in the cycle observed in some periods, such as September 30, 2022, and September 30, 2023, may warrant further investigation into potential inefficiencies or external factors impacting cash conversion.

Overall, monitoring and analyzing the cash conversion cycle can provide valuable insights into the operational efficiency and financial health of Ralph Lauren Corp Class A.