Saia Inc (SAIA)

Saia Inc.'s liquidity ratios display a positive trend over the past five years, indicating an improvement in the company's ability to meet its short-term obligations.

The current ratio measures the company's ability to pay its short-term liabilities with its current assets. Saia Inc.'s current ratio has been consistently above 1.0 since 2019, reaching 2.01 in 2023. This indicates that the company has more than enough current assets to cover its current liabilities, a positive sign of financial health.

The quick ratio, which excludes inventory from current assets, also shows a similar trend to the current ratio, reinforcing the company's strong liquidity position. Saia Inc.'s quick ratio matches its current ratio each year, further confirming the company's ability to meet short-term obligations without relying on selling inventory.

Moving on to the cash ratio, which measures the company's ability to pay off its current liabilities with its cash and cash equivalents, Saia Inc. has shown significant improvement over the years. The cash ratio has been steadily increasing from 0.12 in 2019 to 1.04 in 2023. This indicates that Saia Inc. has a growing capacity to cover its short-term obligations with readily available cash, highlighting a strengthening liquidity position.

Overall, Saia Inc.'s liquidity ratios paint a positive picture, showing an increasingly robust ability to meet its short-term financial obligations. This suggests that the company is managing its current assets effectively and is in a stable financial position in terms of liquidity.

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Additional liquidity measure

Saia Inc.'s cash conversion cycle has shown fluctuations over the past five years. The cash conversion cycle provides insight into how long it takes for the company to convert its investments in inventory and other resources into cash flows from sales.

In 2023, the cash conversion cycle improved to 39.62 days from 41.02 days in 2022, indicating that the company was more efficient in managing its working capital. However, this improvement follows a trend of fluctuation in recent years, with the cycle being 44.14 days in 2021, 43.46 days in 2020, and 41.76 days in 2019.

A lower cash conversion cycle suggests that the company is able to sell its inventory more quickly and collect cash from customers faster. This can be a positive indicator of effective inventory management and efficient accounts receivable collection practices.

Overall, while there have been fluctuations in Saia Inc.'s cash conversion cycle over the years, the recent improvement in 2023 is a positive sign of better working capital management, which can contribute to the company's overall financial health and operational efficiency.