Terex Corporation (TEX)

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	2.01	2.11	2.07	1.99	1.96	1.96	2.00	2.00	1.94	2.13	2.11	2.27	2.60	2.59	2.53	2.53	2.32	2.21	2.21	2.27
Quick ratio	0.82	0.94	0.91	0.84	0.85	0.80	0.84	0.81	0.85	1.13	1.15	1.27	1.45	1.34	1.15	1.18	1.07	1.04	0.92	0.88
Cash ratio	0.33	0.33	0.28	0.24	0.30	0.24	0.26	0.24	0.29	0.59	0.57	0.68	0.92	0.75	0.63	0.66	0.61	0.51	0.33	0.28

Looking at the liquidity ratios of Terex Corp. over the past eight quarters, we can observe the following trends:

1. Current Ratio: The current ratio measures the company's ability to cover its short-term obligations with its current assets. Terex Corp.'s current ratio has generally been above 2 for the past four quarters, indicating that the company has more than enough current assets to cover its current liabilities. This suggests a strong liquidity position.

2. Quick Ratio: The quick ratio provides a more stringent measure of liquidity by excluding inventory from current assets. Terex Corp.'s quick ratio has fluctuated between 0.93 and 1.06 over the past eight quarters, with the latest quarter showing a slight decrease. While the company's quick ratio is generally below 1, which may raise concerns, it is still relatively close to the ideal threshold of 1.

3. Cash Ratio: The cash ratio is the most conservative liquidity ratio, measuring the company's ability to cover its short-term liabilities with cash and cash equivalents alone. Terex Corp.'s cash ratio has ranged from 0.36 to 0.46 over the past eight quarters, indicating a consistent ability to meet short-term obligations with cash on hand. However, the downward trend in the most recent quarter may warrant further attention.

In summary, Terex Corp. has shown a consistent ability to meet its short-term obligations over the past eight quarters, as evidenced by its current ratio staying above 2 and its cash ratio remaining relatively stable. However, monitoring the trend in the quick ratio, especially the recent decrease, could provide insight into the company's ability to quickly cover its liabilities without relying on inventory.

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	83.20	86.73	90.54	88.70	82.68	88.54	89.69	86.86	79.85	75.51	79.34	84.04	79.83	87.89	82.79	77.40	69.47	74.34	80.33	88.46

To analyze Terex Corp.'s cash conversion cycle based on the provided data, we can observe the trend over the last 8 quarters. The cash conversion cycle represents the time it takes for a company to convert its investment in inventory and other resources into cash flows from sales.

From the data, we can see that the cash conversion cycle has fluctuated over the quarters. In Q2 2023, the company experienced its longest cash conversion cycle in the last 8 quarters, at 90.54 days. This indicates that Terex Corp. took longer to convert its investments in assets into cash during that period.

On the other hand, the company had its shortest cash conversion cycle in Q4 2022, at 82.68 days, showing an improvement in efficiency in converting resources into cash compared to other quarters. This suggests that Terex Corp. may have managed its working capital more effectively during that period.

Overall, the trend in the cash conversion cycle for Terex Corp. shows some variability, indicating potential fluctuations in the company's efficiency in managing its inventory, receivables, and payables. Further analysis and comparison with industry benchmarks would provide a more comprehensive understanding of Terex Corp.'s working capital management and overall financial performance.