Constellation Brands Inc Class A (STZ)
Liquidity ratios
| Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | May 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.19 | 1.05 | 1.20 | 1.14 | 1.18 | 1.29 | 1.41 | 1.40 | 1.23 | 1.50 | 1.35 | 1.61 | 2.40 | 1.69 | 1.85 | 1.94 | 1.51 | 1.41 | 1.61 | 1.22 |
| Quick ratio | 0.31 | 0.29 | 0.36 | 0.35 | 0.32 | 0.37 | 0.42 | 0.34 | 0.41 | 0.57 | 1.78 | 1.98 | 0.98 | 1.97 | 0.59 | 0.57 | 1.75 | 0.37 | 0.47 | 0.30 |
| Cash ratio | 0.05 | 0.02 | 0.03 | 0.06 | 0.01 | 0.03 | 0.03 | -0.03 | 0.07 | 0.16 | 1.34 | 1.53 | 0.36 | 1.52 | 0.11 | 0.17 | 1.37 | 0.04 | 0.04 | 0.03 |
The liquidity ratios of Constellation Brands Inc Class A show varying levels of liquidity over the past several quarters.
1. Current Ratio: Constellation Brands Inc Class A's current ratio has fluctuated, ranging from a low of 1.05 to a high of 1.61. The ratio indicates that the company may have had some difficulties in meeting its short-term obligations in some periods, as a ratio below 1 suggests that current liabilities exceed current assets.
2. Quick Ratio: The quick ratio, also known as the acid-test ratio, shows the company's ability to meet its short-term obligations without relying on inventory. Constellation Brands Inc Class A's quick ratio has fluctuated significantly, from a low of 0.29 to a high of 1.98. A ratio below 1 indicates potential difficulties in meeting short-term obligations without relying on inventory.
3. Cash Ratio: The cash ratio represents the company's ability to cover its short-term liabilities with cash and cash equivalents. Constellation Brands Inc Class A's cash ratio has shown a wide range of values, from a low of -0.03 to a high of 1.53. A negative cash ratio, as seen in some periods, indicates that current liabilities exceed cash and cash equivalents, which may raise concerns about the company's liquidity position.
Overall, Constellation Brands Inc Class A's liquidity ratios indicate some fluctuations in its ability to meet short-term obligations over the analyzed periods, with the quick and cash ratios showing more variability compared to the current ratio. It's essential for investors and stakeholders to closely monitor these liquidity indicators to assess the company's financial health and ability to manage short-term financial commitments.
See also:
Constellation Brands Inc Class A Liquidity Ratios (Quarterly Data)
Additional liquidity measure
| Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | May 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 67.65 | 68.27 | 62.46 | 69.02 | 71.59 | 63.59 | 60.64 | 65.93 | 62.56 | 56.95 | 52.34 | 56.09 | 70.11 | 62.20 | 67.64 | 70.18 | 71.93 | 62.31 | 67.25 | 75.22 |
Constellation Brands Inc Class A's cash conversion cycle has shown some fluctuations over the past several reporting periods. The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash inflows from sales.
The company's cash conversion cycle ranged from a low of 52.34 days to a high of 75.22 days over the periods analyzed. A lower cash conversion cycle is generally considered favorable as it indicates that the company is able to generate cash more quickly from its operating activities.
Analyzing the data, we observe that the cash conversion cycle peaked at 75.22 days in the reporting period ending August 31, 2019, indicating a longer period required to convert investments into cash. This could suggest potential inefficiencies in managing inventory, collecting receivables, or paying suppliers during that period.
On the other hand, the lowest cash conversion cycle of 52.34 days in the period ending August 31, 2021, demonstrated improved efficiency in cash conversion. This suggests that the company may have streamlined its operations, improved inventory management, or enhanced collections from customers during that period.
Overall, maintaining a consistent focus on optimizing the cash conversion cycle is essential for improving working capital management and enhancing the company's overall financial health. Tracking fluctuations in the cash conversion cycle over time can provide valuable insights into operational efficiency and financial performance.