SpartanNash Co (SPTN)

Liquidity ratios

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Oct 7, 2023 Sep 30, 2023 Jul 15, 2023 Jun 30, 2023 Apr 22, 2023 Mar 31, 2023 Dec 31, 2022 Oct 8, 2022 Sep 30, 2022 Jun 30, 2022 Apr 23, 2022 Mar 31, 2022 Dec 31, 2021 Oct 9, 2021 Sep 30, 2021
Current ratio 1.57 1.62 1.62 1.75 1.63 1.59 1.59 1.62 1.62 1.69 1.69 1.51 1.63 1.63 1.59 1.56 1.56 1.46 1.43 1.43
Quick ratio 0.03 0.02 0.04 0.03 0.03 0.65 0.03 0.66 0.03 0.67 0.03 0.04 0.03 0.03 0.03 0.62 0.02 0.02 0.04 0.04
Cash ratio 0.03 0.02 0.04 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.04 0.03 0.03 0.03 0.02 0.02 0.02 0.04 0.04

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

1. Current Ratio: The current ratio measures the company's ability to pay off its short-term liabilities with its current assets. SpartanNash Co's current ratio has shown a fluctuating trend over the past few years, starting at 1.43 in September 2021 and increasing to 1.75 by March 2024. Generally, a current ratio above 1 indicates that the company has more current assets than current liabilities, which is a positive sign for creditors and investors.

2. Quick Ratio: The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity as it excludes inventory from current assets. SpartanNash Co's quick ratio has also displayed variability, with values ranging from 0.02 to 0.67 during the period under review. A quick ratio above 1 is considered healthy, as it suggests that the company can meet its immediate obligations without relying on selling inventory.

3. Cash Ratio: The cash ratio focuses solely on the company's ability to cover its current liabilities with its cash and cash equivalents. SpartanNash Co's cash ratio has remained relatively stable, staying within the range of 0.02 to 0.04 over the past few years. A higher cash ratio indicates a stronger ability to cover short-term obligations without relying on other current assets.

Overall, SpartanNash Co's liquidity ratios indicate that the company has generally been able to maintain a healthy liquidity position, with a current ratio consistently above 1 and varying levels of quick and cash ratios. However, fluctuations in these ratios should be further analyzed to understand the underlying reasons and assess the company's overall liquidity risk.


Additional liquidity measure

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Oct 7, 2023 Sep 30, 2023 Jul 15, 2023 Jun 30, 2023 Apr 22, 2023 Mar 31, 2023 Dec 31, 2022 Oct 8, 2022 Sep 30, 2022 Jun 30, 2022 Apr 23, 2022 Mar 31, 2022 Dec 31, 2021 Oct 9, 2021 Sep 30, 2021
Cash conversion cycle days 24.81 25.31 23.87 25.01 27.27 20.51 25.50 18.07 23.79 18.34 24.85 26.80 5.87 26.80 25.96 18.36 26.82 27.11 3.09 26.67

The cash conversion cycle of SpartanNash Co indicates the efficiency of the company's working capital management and the time it takes to convert its investments in inventory and accounts receivable into cash.

Analyzing the data provided, we can see that the cash conversion cycle fluctuates over the periods mentioned. The cycle started at 26.67 days as of September 30, 2021, decreased to 3.09 days on October 9, 2021, and then increased to 27.11 days by December 31, 2021. This variability suggests changes in the company's ability to manage its cash flow effectively.

Throughout the subsequent periods, the cash conversion cycle continues to fluctuate, with some periods showing lower days and others showing higher days. Notably, there are improvements in efficiency as indicated by decreasing days in some periods, such as April 23, 2022 (18.36 days), April 22, 2023 (18.34 days), and July 15, 2023 (18.07 days).

In general, a shorter cash conversion cycle is favorable as it indicates that the company is efficiently managing its working capital. However, large fluctuations in the cycle may suggest inconsistencies in the company's operations, potentially impacting its liquidity and profitability.

Overall, SpartanNash Co should strive to maintain a reasonably low and stable cash conversion cycle to enhance its financial performance and ensure optimal utilization of its resources. Monitoring and analyzing the trends in the cash conversion cycle can provide valuable insights into the company's cash flow dynamics and working capital management.