Roper Technologies, Inc. (ROP)
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 | 0.40 | 0.48 | 0.53 | 0.49 | 0.50 | 0.53 | 0.94 | 0.80 | 0.67 | 1.41 | 1.58 | 1.28 | 0.78 | 0.83 | 0.72 | 0.71 | 0.72 | 0.73 | 1.27 | 0.96 |
| Quick ratio | 0.31 | 0.37 | 0.40 | 0.37 | 0.39 | 0.41 | 0.82 | 0.69 | 0.56 | 0.92 | 1.14 | 1.17 | 0.41 | 0.42 | 0.57 | 0.56 | 0.58 | 0.57 | 1.13 | 0.82 |
| Cash ratio | 0.05 | 0.08 | 0.09 | 0.07 | 0.07 | 0.11 | 0.53 | 0.43 | 0.27 | 0.67 | 0.91 | 0.92 | 0.11 | 0.12 | 0.13 | 0.13 | 0.13 | 0.13 | 0.75 | 0.42 |
Roper Technologies, Inc.'s liquidity ratios indicate its ability to meet short-term obligations. The current ratio fluctuated over the years, ranging from 0.40 to 1.58. A current ratio below 1 suggests potential difficulty in meeting short-term liabilities with current assets alone. Roper's current ratio improved to 1.58 as of June 30, 2022, indicating better short-term liquidity, but declined to 0.40 by December 31, 2024, raising concerns about its short-term solvency.
The quick ratio, which excludes inventory from current assets, also exhibited fluctuations, ranging from 0.31 to 1.17. Similar to the current ratio, the quick ratio trended positively, showing an improvement in short-term liquidity by excluding inventory. However, the ratio decreased to 0.31 by December 31, 2024, indicating a potential weakness in Roper's ability to meet immediate obligations without relying on inventory.
The cash ratio, reflecting the most stringent liquidity measure, ranged from 0.05 to 0.92. This ratio measures the company's ability to cover current liabilities with cash and cash equivalents. Roper's cash ratio showed variability, with a notable improvement to 0.92 by March 31, 2022, before declining to 0.05 by December 31, 2024. A decreasing cash ratio may indicate a potential liquidity risk, especially if the trend continues.
Overall, Roper Technologies, Inc.'s liquidity ratios suggest mixed performance in meeting short-term obligations over the years, with fluctuations in the current, quick, and cash ratios. Monitoring these ratios is essential to assess the company's liquidity position and its ability to manage short-term financial needs effectively.
See also:
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 | 72.90 | 74.18 | 71.71 | 74.34 | 78.46 | 76.96 | 74.61 | 72.78 | 80.54 | 74.73 | 74.97 | 114.04 | 85.67 | 120.44 | 149.24 | 139.80 | 83.19 | 131.06 | 121.47 | 115.21 |
The cash conversion cycle of Roper Technologies, Inc. provides insight into the efficiency of the company's working capital management. The trend analysis of the cash conversion cycle over the past few years shows fluctuations in the number of days it takes for the company to convert its investments in inventory and other resources back into cash.
From March 31, 2020, to December 31, 2024, Roper Technologies' cash conversion cycle has exhibited variability, ranging from a high of 149.24 days in June 2021 to a low of 71.71 days in June 2024. A longer cash conversion cycle indicates that the company takes more time to recover its investments, potentially tying up funds that could be used for other purposes.
The company experienced a significant improvement in its cash conversion cycle from September 2022 to December 2024, with the cycle decreasing steadily. This decrease suggests that Roper Technologies has been able to manage its working capital more effectively, possibly by streamlining its operations, optimizing inventory levels, and improving its collection processes.
Overall, a declining trend in the cash conversion cycle is a positive sign as it indicates that the company is becoming more efficient in managing its working capital and generating cash flows. It's essential for investors and analysts to monitor this metric closely to assess the company's liquidity and operational efficiency levels accurately.