Trimble Inc (TRMB)

Trimble Inc's liquidity ratios show fluctuations over the past few quarters.

The current ratio, which measures the company's ability to meet short-term obligations with its current assets, has varied between 0.98 and 1.51. The current ratio has been generally above 1, indicating that Trimble Inc has been able to cover its short-term liabilities with its current assets. However, the ratio dipped to 0.98 in the third quarter of 2020, suggesting potential liquidity challenges at that time.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has ranged from 0.15 to 1.09. Trimble Inc's quick ratio has been volatile, falling significantly below 1 in some quarters. This indicates that the company may have had difficulty meeting its short-term obligations without relying on inventory in those periods.

The cash ratio, which focuses solely on the most liquid assets like cash and equivalents to short-term liabilities, has varied from 0.13 to 0.70. Trimble Inc's cash ratio has generally been low, indicating a reliance on less liquid assets to cover short-term obligations. However, the ratio improved in the first quarter of 2023, reaching 0.70, which might suggest an increase in the company's cash holdings.

Overall, while Trimble Inc has shown some variability in its liquidity ratios, the company has generally maintained sufficient liquidity to meet its short-term obligations, with improvements seen in certain periods.

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Additional liquidity measure

The cash conversion cycle of Trimble Inc has exhibited fluctuations over the past few periods. In general, a shorter cash conversion cycle indicates that the company is able to convert its investments in inventory into cash more quickly.

From Q4 2019 to Q1 2020, there was a notable decrease in the cash conversion cycle from 37.42 days to 33.47 days, indicating an improvement in the efficiency of the company's working capital management. However, from Q1 2020 to Q4 2020, the cash conversion cycle increased significantly to 113.26 days, which suggests a delay in the conversion of sales to cash, possibly due to challenges in managing accounts receivables or inventory.

Subsequently, from Q4 2020 to Q1 2021, there was a sharp decline in the cash conversion cycle to 35.75 days, indicating a rapid improvement in working capital efficiency. However, this improvement was short-lived as the cycle increased to 27.97 days in Q2 2021, before rising further to 30.19 days in Q3 2021.

The company saw a significant decrease in the cash conversion cycle in Q4 2021 to 101.31 days, which could indicate challenges in managing working capital effectively. However, this trend reversed in Q1 2022, where the cycle decreased to a significantly lower 30.22 days, suggesting a swift improvement in cash conversion efficiency.

In Q2 2022, the cycle increased slightly to 35.54 days, which could imply some operational challenges affecting working capital management. This trend continued in Q3 2022 with a further increase to 83.80 days, before decreasing to 97.59 days in Q4 2022.

The cash conversion cycle improved in Q1 2023 to 91.84 days and further decreased to 94.26 days in Q2 2023. However, in the most recent period, Q4 2023, the cycle increased to 76.09 days, which may indicate potential challenges in managing working capital efficiency.

Overall, the analysis of Trimble Inc's cash conversion cycle shows fluctuations over time, highlighting the importance of ongoing monitoring and management of working capital to ensure optimal efficiency in converting investments into cash.