Rollins Inc (ROL)

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 0.69 0.78 0.78 0.72 0.71 0.82 0.81 0.79 0.71 0.78 0.98 1.03 0.72 0.78 0.73 0.66 0.67 0.71 0.76 0.73
Quick ratio 0.51 0.59 0.59 0.57 0.56 0.65 0.64 0.67 0.58 0.66 0.82 0.91 0.58 0.65 0.30 0.27 0.25 0.24 0.32 0.26
Cash ratio 0.14 0.17 0.19 0.21 0.18 0.25 0.27 0.26 0.19 0.26 0.45 0.56 0.24 0.27 0.27 0.23 0.21 0.20 0.28 0.22

Rollins Inc's liquidity ratios have shown fluctuations over the past few years. The company's current ratio, which measures its ability to cover short-term liabilities with current assets, ranged from a low of 0.66 on March 31, 2021, to a high of 1.03 on March 31, 2022. The current ratio improved significantly in the latest period, reaching 0.81 on June 30, 2024, indicating a stronger ability to meet its short-term obligations.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, also displayed variability. The quick ratio ranged from a low of 0.24 on September 30, 2020, to a high of 0.91 on March 31, 2022. Notably, there was a substantial improvement in the quick ratio from 0.51 on December 31, 2024, to 0.59 on June 30, 2024, suggesting enhanced liquidity without relying on inventory.

In terms of the cash ratio, which assesses the company's ability to cover current liabilities with cash and cash equivalents, Rollins Inc's performance fluctuated. The cash ratio ranged from a low of 0.14 on December 31, 2024, to a high of 0.56 on March 31, 2022. While the cash ratio improved from 0.17 on September 30, 2024, to 0.19 on June 30, 2024, the company may need to maintain a higher level of cash reserves for enhanced liquidity in the future.

Overall, Rollins Inc has shown improvements in its liquidity ratios in recent periods, particularly in the current and quick ratios. However, the company should continue monitoring its cash position to ensure it has sufficient resources to meet its short-term obligations effectively.

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 24.22 26.80 25.52 24.06 23.35 27.44 20.97 23.70 23.57 26.19 24.40 22.86 22.49 25.94 -4.75 -2.79 -2.57 -2.82 -0.31 -2.00

The cash conversion cycle (CCC) for Rollins Inc has shown significant fluctuations over the period from March 31, 2020, to December 31, 2024. The CCC started with negative values, indicating efficient management of working capital early on. However, the cycle turned positive from September 30, 2021, indicating a less efficient use of cash.

From September 30, 2021, to September 30, 2024, the CCC fluctuated within a range of approximately 20 to 27 days. The increase in the CCC from negative values to positive values suggests potential issues in managing accounts receivable, inventory, and accounts payable.

It is important for Rollins Inc to closely monitor its cash conversion cycle as a prolonged increase can tie up cash, leading to liquidity challenges. Management should focus on optimizing the cycle by improving collections on receivables, controlling inventory levels, and effectively managing payables to enhance cash flow efficiency and overall financial performance.