Synaptics Incorporated (SYNA)

The analysis of Synaptics Incorporated's liquidity ratios over the observed period reflects a generally strong and stable liquidity position, with some notable fluctuations.

Starting with the current ratio, which measures the company's ability to meet short-term obligations using current assets, the data indicates a gradual upward trend from 2.41 as of September 30, 2020, to a peak of approximately 5.32 in March 2024. This suggests that Synaptics has maintained a comfortable buffer of current assets relative to current liabilities, although there was a significant increase in this ratio during 2021 and early 2022, potentially reflecting improved working capital management or asset accumulation. Post-March 2024, the current ratio shows a decline to around 2.78 by June 2025, but it remains above the generally accepted threshold of 1.0, indicating ongoing short-term liquidity adequacy.

The quick ratio, which excludes inventory from current assets to assess more liquid assets’ coverage of current liabilities, demonstrates a similar upward trajectory. Starting from 1.83 in September 2020, it rose considerably to above 4.60 by March 2024, illustrating that Synaptics significantly increased its liquid assets relative to current liabilities during this period. This strengthens the perception of a robust liquidity position, with quick ratios well above 1.0, signaling that the company can cover its immediate liabilities without relying on inventory sales. After March 2024, the quick ratio declines somewhat to approximately 2.15 in June 2025 but continues to suggest strong liquidity.

The cash ratio, which considers only the most liquid assets (cash and cash equivalents), shows an even more pronounced growth from 0.95 in September 2020 to peaks exceeding 3.9 around March 2024. This indicates that Synaptics held substantial cash reserves relative to its current liabilities during this period, further emphasizing its liquidity strength. Following this peak, the cash ratio decreases to about 1.70 by June 2025, yet remains indicative of ample cash reserves to meet immediate liabilities.

Overall, these ratios depict a company with significant liquidity reserves throughout the examined period. The substantial increases around 2021 and early 2022 reflect periods of enhanced cash accumulation or reduced short-term obligations, whereas the subsequent stabilization signifies prudent liquidity management. Despite some declines post-March 2024, Synaptics maintains ratios well above critical thresholds, underscoring a resilient liquidity position capable of supporting ongoing operations and short-term obligations comfortably.

---

Additional liquidity measure

The analysis of Synaptics Incorporated's cash conversion cycle (CCC) over the provided period reveals notable fluctuations and trends. The CCC measures the time span between the outlay of cash for inventory and the collection of cash from sales, reflecting the efficiency of working capital management.

Initially, as of September 30, 2020, the CCC stood at approximately 80.58 days. Over the subsequent quarters, there was a significant decline, reaching a low of approximately 47.28 days by March 31, 2021. This reduction indicates improved operational efficiency, possibly due to better inventory management, streamlined receivables, or a quicker turnover of current assets.

However, subsequent periods show volatility. From March 31, 2021, through September 30, 2021, the CCC slightly increased to approximately 49.40 days, suggesting a partial reversal in efficiency gains. Moving into 2022, the cycle expanded again, reaching around 97.58 days at the end of December 2022, nearly doubling the earlier low point, which may point to increased inventory holding periods or slower receivables collection.

During 2023, the CCC demonstrated a period of stabilization, with values fluctuating around the 80 to 90-day range. Notably, by June 30, 2023, the cycle was approximately 96.69 days, while by September 30, 2023, it decreased slightly to 80.93 days. The end of 2023 and early 2024 showed a slight decrease in the CCC, with values around 73.86 days and 75.62 days, respectively.

Looking into 2024 and into mid-2025, there is a tendency towards cyclical improvement, with the CCC decreasing from approximately 76.67 days at the end of December 2024 to 69.47 days by June 30, 2025. As of September 30, 2025, the cycle stands at roughly 69.47 days, indicating a relative stabilization and possible enhanced collection and inventory management.

Overall, the trend suggests cyclical fluctuations with periods of both efficiency improvement and deterioration. The most recent data indicates a stabilization around the 70-day mark, implying that Synaptics has managed to regain some operational efficiency, though swings over the measured period reflect ongoing operational adjustments or external market influences affecting inventory turnover, receivables, or payables management strategies.