Shenandoah Telecommunications Co (SHEN)

Shenandoah Telecommunications Co.'s liquidity ratios have shown fluctuations over the past five years. The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, has generally been at healthy levels. In 2023, the current ratio improved significantly to 1.79 compared to the previous year's 1.33. This suggests that the company's current assets are sufficient to cover its current liabilities, indicating improved short-term liquidity.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, also indicates an upward trend in 2023, standing at 1.78 compared to 1.10 in 2022. This indicates that the company has a better capacity to cover its short-term liabilities with its most liquid assets, excluding inventory.

The cash ratio, which measures the company's ability to cover its current liabilities with its cash and cash equivalents alone, has also witnessed an improvement in 2023, with a ratio of 1.54 compared to 0.58 in 2022. This suggests that Shenandoah Telecommunications Co. has more cash on hand to meet its current obligations.

Overall, the improvements in all three liquidity ratios in 2023 indicate that Shenandoah Telecommunications Co.'s liquidity position strengthened during that year. Having sufficient liquidity is crucial for the company to meet its short-term obligations and fund its operations effectively. It is important for stakeholders to continue monitoring these ratios to ensure the company's financial health and ability to navigate potential liquidity challenges in the future.

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Additional liquidity measure

The cash conversion cycle of Shenandoah Telecommunications Co. has fluctuated over the past five years.

In 2023, the cash conversion cycle decreased significantly to -153.12 days, indicating that the company's cash was tied up for a shorter period compared to the previous year. This may suggest improved efficiency in converting its resources into cash.

In 2022, the cash conversion cycle also decreased to -98.13 days compared to the prior year. Despite the improvement, the company still had negative cash conversion days, meaning it was able to operate without using its own funds to finance operations.

In 2021, the cash conversion cycle improved further to -24.16 days, indicating that the company's ability to convert its investments into cash improved significantly. This may suggest effective management of working capital components.

In 2020, the cash conversion cycle turned positive to 35.27 days, signifying that the company's cash was tied up for a longer period compared to the prior year. This could indicate potential inefficiencies in managing working capital.

In 2019, the cash conversion cycle was negative at -5.15 days, suggesting that the company was able to generate cash quickly from its operating cycle.

Overall, fluctuations in the cash conversion cycle indicate changes in the company's efficiency in managing its working capital components, with negative days being favorable as it reflects efficient operations in converting investments into cash.