Schneider National Inc (SNDR)

Schneider National Inc's current ratio, which measures the company's ability to cover its short-term obligations with its current assets, has shown some fluctuations over the analyzed periods. The ratio stood at a healthy level of around 3.00 in early 2020 but has gradually declined, dropping to around 1.40 by the end of 2024. This downward trend indicates a potential weakening in the company's short-term liquidity position and its ability to meet immediate financial commitments.

In terms of the quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, Schneider National Inc also experienced a decrease over the years. The ratio started at above 1.00 in early 2020 but fell significantly to below 0.30 by the end of 2024. This decline suggests that the company may face challenges in meeting short-term obligations without relying on selling its inventory.

Lastly, the cash ratio, indicating the proportion of cash and cash equivalents to cover current liabilities, has exhibited a similar downward trend. The ratio declined from over 1.00 at the beginning of the analysis period to below 0.30 by the end of 2024. This decline in the cash ratio raises concerns about Schneider National Inc's ability to settle immediate liabilities solely with its available cash resources.

Overall, the decreasing trend in Schneider National Inc's liquidity ratios, particularly the current ratio, quick ratio, and cash ratio, highlights a potential liquidity strain on the company's operations and its ability to meet short-term financial obligations effectively. Management should closely monitor these ratios and take appropriate actions to ensure the company's liquidity remains stable and sufficient to support its financial health.

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Additional liquidity measure

The cash conversion cycle of Schneider National Inc has shown some fluctuations over the time period from March 31, 2020, to December 31, 2024.

The company's cash conversion cycle measures the time needed to convert its investments in inventory and other resources into cash flows from sales. A shorter cash conversion cycle typically indicates better liquidity management and efficiency in the company's operations.

Looking at the data provided, we can observe that Schneider National Inc had a relatively stable cash conversion cycle in 2020, ranging from 5.37 days to 4.02 days. This suggests that the company was managing its working capital effectively during that period.

In the subsequent years, from 2021 to 2023, there was a significant improvement in the cash conversion cycle, with the days decreasing to as low as 1.85 days. This indicates that Schneider National Inc was able to optimize its working capital and efficiently convert its investments into cash more quickly.

However, there was a slight uptick in the cash conversion cycle in the latter part of 2023 and in 2024, with the days increasing to around 6 to 8 days. This may raise concerns about the company's liquidity position and efficiency in managing its working capital during that period.

Overall, Schneider National Inc's cash conversion cycle has shown variability over the years, with periods of strong performance in working capital management and some fluctuations that may warrant further investigation to ensure continued operational efficiency and healthy financial performance.