Strategic Education Inc (STRA)

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 1.57 1.32 1.45 1.48 1.57 1.55 1.68 1.64 1.88 1.59 1.56 1.41 1.43 4.13 3.72 3.31 3.34 3.20 3.19 2.97
Quick ratio 1.36 1.14 1.23 1.24 1.36 1.37 1.48 1.43 1.67 1.43 1.37 1.24 1.24 4.02 3.60 3.18 3.24 3.11 3.08 2.87
Cash ratio 0.99 0.74 0.85 0.94 1.06 1.05 1.15 1.18 1.41 1.09 1.05 0.98 0.98 3.78 3.31 2.92 2.90 2.73 2.70 2.53

Strategic Education Inc's liquidity ratios, as reflected in the data provided, indicate the company's ability to meet short-term obligations.

The current ratio, which measures the company's ability to cover short-term liabilities with current assets, has shown some fluctuations over the quarters but generally remains above 1, suggesting that the company has sufficient current assets to cover its current liabilities. The ratio ranged from 1.32 to 1.57 over the quarters, with the highest value in Q4 2023.

The quick ratio, also known as the acid-test ratio, provides a more conservative measure of liquidity by excluding inventory from current assets. Similar to the current ratio, the quick ratio fluctuated but generally stayed above 1, indicating a strong ability to meet short-term obligations without relying on inventory. The ratio ranged from 1.27 to 1.57, with the highest value in Q4 2023.

The cash ratio, which is the most stringent measure of liquidity as it only considers cash and cash equivalents, also varied over the quarters but generally remained above 1. This suggests that the company holds sufficient cash to cover its current liabilities without relying on other current assets. The cash ratio ranged from 0.87 to 1.27, with the highest value in Q4 2022.

Overall, the liquidity ratios of Strategic Education Inc demonstrate a consistent ability to meet short-term obligations with a comfortable margin, as evidenced by the current ratio, quick ratio, and cash ratio remaining above 1 in most quarters. It indicates that the company maintains a healthy liquidity position, which is essential for financial stability and operational flexibility.

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 24.50 34.81 31.09 26.85 21.49 27.82 25.70 21.61 16.89 30.11 30.10 22.96 19.08 17.31 15.18 15.32 19.34 22.46 24.13 24.86

The cash conversion cycle measures the time it takes for a company to convert its resources invested in inventory into cash flows from sales. A shorter cash conversion cycle is generally preferred as it indicates better liquidity and efficiency in managing working capital.

In the case of Strategic Education Inc, the cash conversion cycle has shown some fluctuations over the past eight quarters. In Q4 2023, the company's cash conversion cycle was 24.52 days, a decrease from the previous quarter's 34.93 days. This improvement suggests that the company was able to manage its working capital more effectively and convert its inventory into cash more efficiently.

Looking at the historical trend, the cash conversion cycle has generally been relatively low for the company, with occasional fluctuations in certain quarters. This indicates that Strategic Education Inc has been efficient in managing its working capital and converting its inventory into cash.

Overall, the decreasing trend in the cash conversion cycle for Strategic Education Inc is a positive indication of the company's ability to effectively manage its operations and working capital, leading to improved liquidity and financial performance.