Tesla Inc (TSLA)
Liquidity ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 2.02 | 1.84 | 1.91 | 1.72 | 1.73 | 1.69 | 1.59 | 1.57 | 1.53 | 1.46 | 1.43 | 1.35 | 1.38 | 1.39 | 1.51 | 1.66 | 1.88 | 1.63 | 1.25 | 1.24 |
| Quick ratio | 1.42 | 1.21 | 1.24 | 1.04 | 1.13 | 1.07 | 0.96 | 0.93 | 0.94 | 0.95 | 0.96 | 0.95 | 1.00 | 1.00 | 1.12 | 1.28 | 1.49 | 1.23 | 0.82 | 0.78 |
| Cash ratio | 1.27 | 1.10 | 1.11 | 0.91 | 1.01 | 0.98 | 0.84 | 0.82 | 0.83 | 0.86 | 0.87 | 0.84 | 0.90 | 0.89 | 0.99 | 1.15 | 1.36 | 1.09 | 0.70 | 0.67 |
The current ratio of Tesla Inc has shown a general uptrend from 1.24 in March 2020 to 2.02 in December 2024. This indicates an improving ability to cover short-term liabilities with current assets over the period.
The quick ratio, which provides a more conservative measure of liquidity by excluding inventories from current assets, has also trended upwards, suggesting an increasing ability to meet short-term obligations without relying on inventory sales. The quick ratio increased from 0.78 in March 2020 to 1.42 in December 2024.
The cash ratio, which measures the company's ability to cover its current liabilities with its cash and cash equivalents, has fluctuated within a relatively narrower range compared to the current ratio and quick ratio. However, it generally exhibits a positive trend, indicating an improvement in the company's cash position relative to its short-term obligations.
Overall, the liquidity ratios of Tesla Inc have shown positive trends over the period, indicating a strengthening liquidity position and the ability to meet short-term obligations effectively.
See also:
Additional liquidity measure
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 14.43 | 11.90 | 19.63 | 21.12 | 9.52 | 8.59 | 8.85 | 4.28 | -1.29 | -13.00 | -11.79 | -22.44 | -25.69 | -15.64 | -12.94 | -13.12 | -6.64 | 10.72 | 27.95 | 26.98 |
The cash conversion cycle is a key metric that measures how efficiently a company manages its cash flows related to its operations. It reflects the number of days it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
Based on the data provided for Tesla Inc from March 31, 2020, to December 31, 2024, the trend of the cash conversion cycle shows several interesting patterns.
1. In early 2020, the company's cash conversion cycle was positive, indicating that it took around 26 to 28 days to convert its investments into cash flows from sales. This period suggests a relatively efficient management of cash flows.
2. By September 2020, Tesla Inc's cash conversion cycle decreased significantly to around 11 days, implying that the company was able to convert its resources into cash more rapidly, possibly due to improved inventory management or faster sales realization.
3. The trend continued with the company achieving negative cash conversion cycles starting from December 31, 2020, through December 31, 2022. Negative days indicate that Tesla Inc was able to convert its investments into cash flows before investing in new resources. This could signify improved working capital management and faster turnover of assets.
4. From March 31, 2023, onwards, the cash conversion cycle turned positive again, suggesting an increase in the number of days required to convert investments into cash flows. This could be due to changes in the company's operational processes, sales patterns, or inventory management strategies.
Overall, Tesla Inc's cash conversion cycle fluctuated over the years, showing periods of efficient cash management and increased efficiency in converting investments into cash flows. Analyzing this metric provides insights into how effectively the company utilizes its resources and manages its working capital.