Rambus Inc (RMBS)
Liquidity ratios
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 7.08 | 6.54 | 5.29 | 5.12 | 4.16 | 4.07 | 3.60 | 3.24 | 2.56 | 6.56 | 8.34 | 9.01 | 8.15 | 7.98 | 8.48 | 8.48 | 7.71 | 7.43 | 7.59 | 7.87 |
| Quick ratio | 6.28 | 6.00 | 4.84 | 4.70 | 3.90 | 3.83 | 3.48 | 3.13 | 2.49 | 6.35 | 8.11 | 8.74 | 7.80 | 7.64 | 8.11 | 8.14 | 7.38 | 6.34 | 6.44 | 7.51 |
| Cash ratio | 4.78 | 4.46 | 3.28 | 3.04 | 2.47 | 2.27 | 2.18 | 2.04 | 1.82 | 4.41 | 5.86 | 6.58 | 5.85 | 5.72 | 5.82 | 5.44 | 4.73 | 3.83 | 4.00 | 4.42 |
Rambus Inc.'s liquidity ratios have shown a consistent improvement over the past quarters. The current ratio, which measures the company's ability to cover short-term obligations with its current assets, has been steadily increasing from 3.24 in Q1 2022 to 7.08 in Q4 2023. This indicates a strong liquidity position, with more than enough current assets to cover current liabilities.
The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, also demonstrates a positive trend. It has risen from 3.20 in Q1 2022 to 6.67 in Q4 2023, showing that the company has a high level of liquid assets to cover immediate liabilities.
In terms of the cash ratio, which provides a view of the company's ability to cover its short-term liabilities with cash and cash equivalents, Rambus Inc. has shown consistent improvement. The cash ratio has increased from 2.11 in Q1 2022 to 5.17 in Q4 2023, indicating a growing ability to meet short-term obligations with readily available cash.
Overall, the trend in Rambus Inc.'s liquidity ratios reflects a strong financial position and a healthy ability to meet short-term obligations, which is crucial for the company's operational stability and growth prospects.
Additional liquidity measure
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 169.72 | 163.68 | 173.68 | 149.45 | 132.03 | 130.59 | 147.27 | 141.73 | 185.25 | 197.52 | 238.73 | 265.08 | 279.92 | 263.84 | 264.93 | 284.11 | 370.10 | 347.46 | 335.88 | 347.44 |
The cash conversion cycle of Rambus Inc. has fluctuated over the past eight quarters. The company's cash conversion cycle represents the length of time it takes for Rambus to convert its investments in inventory and other resources into cash flows from sales to customers.
In Q4 2023, Rambus had a cash conversion cycle of 179.32 days, which indicates that the company took longer to convert its resources into cash compared to the previous quarter (Q3 2023 - 172.40 days). This may suggest potential inefficiencies in managing inventory, accounts receivable, and accounts payable during this quarter.
Looking at the trend over the past year, Rambus experienced a significant increase in the cash conversion cycle from Q1 2023 (152.91 days) to Q2 2023 (180.73 days), followed by a slight decline. However, the cycle remained elevated compared to the previous year, where Q4 2022 recorded a lower value (130.06 days).
The overall pattern reveals some fluctuations in Rambus Inc.'s efficiency in managing its working capital components. Investors and stakeholders may want to closely monitor these fluctuations to assess the company's operational efficiency and financial health. Further analysis and comparison with industry benchmarks could provide insights into potential areas for improvement within the company's cash conversion cycle.