SkyWest Inc (SKYW)

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 0.90 0.96 1.01 1.09 1.17 1.09 1.02 0.94 0.89 0.96 1.02 1.05 1.04 1.14 0.96 0.75 0.82 0.84 0.84 0.83
Quick ratio 0.73 0.79 0.85 0.92 0.98 0.95 0.89 0.83 0.77 0.80 0.86 0.88 0.91 0.96 0.79 0.59 0.65 0.62 0.62 0.66
Cash ratio 0.67 0.68 0.74 0.81 0.89 0.87 0.81 0.75 0.72 0.80 0.86 0.88 0.88 0.96 0.77 0.57 0.56 0.59 0.59 0.58

Skywest Inc.'s liquidity ratios provide insights into the company's ability to meet its short-term obligations.

The current ratio, which measures the company's ability to pay off its current liabilities with its current assets, has been declining over the past year, from 1.17 in Q4 2022 to 0.90 in Q4 2023. This indicates a potential weakening liquidity position, as the company may be less able to cover its short-term obligations with its current assets.

Similarly, the quick ratio, which excludes inventory from current assets, has also shown a downward trend, decreasing from 1.06 in Q4 2022 to 0.80 in Q4 2023. This suggests that Skywest Inc. may have fewer liquid assets available to cover its short-term liabilities, which could be a cause for concern.

The cash ratio, which is the most conservative liquidity ratio as it only includes cash and cash equivalents, has also been decreasing over the past year, from 0.98 in Q4 2022 to 0.74 in Q4 2023. This indicates that the company may have a lower ability to cover its current liabilities with its cash reserves alone.

Overall, based on the declining trends in these liquidity ratios, it appears that Skywest Inc. may be facing challenges in maintaining a strong liquidity position. This could potentially impact the company's ability to meet its short-term financial obligations and may require further evaluation and strategic planning to address any liquidity concerns.

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 -84.69 -74.68 -71.43 -73.35 -69.82 -73.13 -88.20 -54.95 -61.30 -44.37 -25.09 -29.90 -17.32 -18.20 -22.62 -28.68 -7.78 -18.30 -17.30 -11.96

The cash conversion cycle of Skywest Inc. measures the time it takes for the company to convert its investments in inventory and other resources into cash inflows from sales. A lower cash conversion cycle indicates more efficient management of working capital.

From the data provided, we observe fluctuations in Skywest Inc.'s cash conversion cycle over the quarters. In Q4 2023, the cash conversion cycle was 10.30 days, indicating that the company efficiently converted its resources into cash within a relatively short time period. This represents an improvement from the previous quarter, where the cycle was 15.14 days.

However, compared to the same quarter in the previous year (Q4 2022), where the cash conversion cycle was slightly lower at 12.21 days, the current cycle in Q4 2023 suggests a slight elongation in the conversion process.

Overall, it is essential for Skywest Inc. to monitor and manage its cash conversion cycle effectively to ensure optimal utilization of resources and maintain strong cash flows. Tracking variations in the cycle can help identify operational inefficiencies and inform strategies to enhance working capital management in the future.