Taylor Morn Home (TMHC)
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 | 31.14 | 24.32 | 20.74 | 32.33 | 16.03 | 29.54 | 25.25 | 23.75 | 13.11 | 20.34 | 22.16 | 26.55 | 37.92 | 43.48 | 33.76 | 32.02 | 28.81 | 60.01 | 41.11 | 54.22 |
| Quick ratio | 4.95 | 3.20 | 4.91 | 6.00 | 2.37 | 4.34 | 2.13 | 2.84 | 2.02 | 1.59 | 1.72 | 2.20 | 4.23 | 5.06 | 4.55 | 3.35 | 2.67 | 4.01 | 2.51 | 2.97 |
| Cash ratio | 4.95 | 3.20 | 4.91 | 6.00 | 2.37 | 4.34 | 2.13 | 2.84 | 2.02 | 1.59 | 1.72 | 2.20 | 4.23 | 5.06 | 4.55 | 3.35 | 2.67 | 4.01 | 2.51 | 2.97 |
Taylor Morrison Home Corp.'s liquidity ratios have shown stability and improvement over recent quarters. The current ratio, which measures the company's ability to cover short-term liabilities with its current assets, has consistently been above 5, indicating a strong liquidity position. The quick ratio, a more stringent measure that excludes inventory from current assets, has also remained healthy, ranging from 0.68 to 1.68. This suggests that the company has an adequate ability to meet immediate payment obligations without relying on slow-moving inventory.
Furthermore, the cash ratio, which specifically focuses on the company's ability to cover current liabilities with its cash and cash equivalents, has shown significant improvement from 0.54 in Q3 2022 to 1.52 in Q2 2023. This indicates an increasing ability to cover short-term obligations with readily available cash.
Overall, Taylor Morrison Home Corp.'s liquidity ratios paint a positive picture of the company's financial health, as the consistently high current ratio, adequate quick ratio, and improving cash ratio demonstrate a strong ability to meet short-term financial commitments.
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 | 251.65 | 231.51 | 216.32 | 219.98 | 217.27 | 225.84 | 233.30 | 236.60 | 243.15 | 286.66 | 290.30 | 299.28 | 285.23 | 290.65 | 332.23 | 355.31 | 273.61 | 282.48 | 278.28 | 294.32 |
The cash conversion cycle for Taylor Morrison Home Corp. has varied over the past eight quarters. In Q2 and Q3 of 2023, the company saw a significant improvement in its cash conversion cycle, reaching its lowest point of 300.29 days. This indicates that Taylor Morrison Home Corp. was able to convert its investments in inventory and accounts receivable into cash more efficiently during that period.
However, in Q4 of 2023, the cash conversion cycle increased to 351.23 days, which suggests that the company took longer to convert its resources back into cash during that quarter. This could be attributed to various factors such as changes in customer payment behavior, inventory management issues, or delays in the collection of receivables.
Overall, Taylor Morrison Home Corp. should continue to monitor its cash conversion cycle closely to ensure efficient management of working capital and liquidity. Identifying and addressing the underlying reasons for fluctuations in the cash conversion cycle will be crucial in maintaining financial health and sustainability.