Under Armour Inc A (UAA)

The liquidity ratios of Under Armour Inc A indicate its ability to meet short-term financial obligations.

1. Current Ratio:
The current ratio measures the company's ability to pay off its short-term liabilities with its current assets. Under Armour Inc A's current ratio has shown a generally improving trend over the years, reaching 2.46 as of March 31, 2024. This indicates that the company has $2.46 in current assets for every $1 in current liabilities, reflecting a strong liquidity position.

2. Quick Ratio:
The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. Under Armour Inc A's quick ratio has also improved over time, standing at 1.39 as of March 31, 2024. This suggests that the company can cover its short-term obligations with its most liquid assets, although it is slightly lower than the current ratio.

3. Cash Ratio:
The cash ratio specifically focuses on the company's ability to pay off its current liabilities with cash and cash equivalents. Under Armour Inc A's cash ratio has fluctuated over the years, with a sharp increase to 1.15 as of December 31, 2021, followed by a decrease to 0.74 as of March 31, 2024. This ratio indicates that the company has $0.74 in cash for every $1 in current liabilities, reflecting a moderate cash position.

Overall, based on the liquidity ratios provided, Under Armour Inc A appears to have maintained a solid liquidity position, with adequate short-term assets to cover its current liabilities. However, monitoring the trends in these ratios is essential to assess the company's ongoing liquidity management.

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Additional liquidity measure

The cash conversion cycle of Under Armour Inc A has shown fluctuations over the past five years. In March 2024, the company's cash conversion cycle was 104.90 days, slightly lower compared to the previous year. This indicates that it took Under Armour Inc A approximately 104.90 days to convert its investments in inventory back into cash during the period.

Compared to March 2023 and December 2020, the cash conversion cycle was slightly higher, indicating a longer period to convert inventory into cash. In December 2021, there was a significant improvement in the cash conversion cycle to 62.17 days, showing that Under Armour Inc A was able to convert its investments in inventory into cash more efficiently during that period.

Overall, fluctuations in the cash conversion cycle can reflect changes in the company's inventory management, accounts receivable collection, and accounts payable payment practices. It is essential for Under Armour Inc A to monitor and manage its cash conversion cycle effectively to optimize its working capital management and overall financial performance.