SpartanNash Co (SPTN)
Liquidity ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Current ratio | 1.63 | 1.51 | 1.46 | 1.47 | 1.76 |
| Quick ratio | 0.67 | 0.61 | 0.57 | 0.55 | 0.65 |
| Cash ratio | 0.03 | 0.04 | 0.02 | 0.03 | 0.04 |
SpartanNash Co's liquidity ratios indicate the company's ability to meet its short-term obligations effectively. The current ratio has exhibited a fluctuating trend over the past five years, with a current ratio of 1.63 in 2023, showing an improvement compared to the previous year. This indicates that SpartanNash Co's current assets are 1.63 times higher than its current liabilities in 2023, providing a comfortable margin for meeting short-term obligations.
In terms of quick ratio, SpartanNash Co's ability to cover its current liabilities with its most liquid assets (excluding inventory) has also shown improvement, with a ratio of 0.67 in 2023. This indicates an increase in the company's liquidity position compared to the previous year.
When considering the cash ratio, which represents the proportion of current liabilities covered by cash and cash equivalents, SpartanNash Co's cash ratio of 0.03 in 2023 is lower than in the previous year. This indicates that the company may have a relatively lower level of cash and cash equivalents available to cover its short-term liabilities.
Overall, while the current and quick ratios suggest an improvement in SpartanNash Co's liquidity position in 2023, the declining cash ratio implies that the company may need to closely monitor its cash reserves to ensure it can meet its short-term obligations effectively.
Additional liquidity measure
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 20.33 | 19.05 | 18.41 | 17.51 | 21.36 |
The cash conversion cycle of SpartanNash Co has shown fluctuation over the past five years. The cycle measures the time it takes for a company to convert its resources invested in inventory into cash flows from sales.
In 2023, the cash conversion cycle increased slightly to 20.33 days from 19.05 days in 2022. This indicates that SpartanNash Co took slightly longer to convert its investment in inventory into cash compared to the previous year.
When compared to 2021, there was a slight improvement in 2022, with the cash conversion cycle decreasing from 18.41 days to 19.05 days. However, in 2021, the cycle was shorter compared to 2020 and 2019, indicating more efficiency in managing inventory and cash flow.
The cash conversion cycle was longest in 2019 at 21.36 days, suggesting that SpartanNash Co took a relatively longer time to convert its inventory investment into cash that year.
Overall, the trend in the cash conversion cycle for SpartanNash Co shows some variability over the years, indicating fluctuations in inventory management efficiency and cash flow conversion. Tracking and analyzing this ratio can help identify areas for improvement in working capital management.