Ufp Industries Inc (UFPI)
Liquidity ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Current ratio | 4.41 | 3.70 | 2.67 | 3.32 | 3.09 |
| Quick ratio | 3.05 | 2.04 | 1.37 | 2.02 | 1.59 |
| Cash ratio | 2.03 | 0.97 | 0.42 | 0.99 | 0.53 |
The liquidity ratios of Ufp Industries Inc have shown a generally positive trend over the past five years.
The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, has been increasing steadily, from 3.09 in 2019 to 4.41 in 2023. This indicates a healthy liquidity position, with the company having more than enough current assets to meet its short-term obligations.
The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. Ufp Industries Inc has also seen an improvement in its quick ratio over the years, reaching 3.05 in 2023 from 1.59 in 2019. This suggests that the company has strong liquidity even when inventory is removed from the equation.
The cash ratio, which focuses specifically on the company's ability to cover its current liabilities with its cash and cash equivalents, has experienced significant growth as well. From 0.53 in 2019, the cash ratio has risen to 2.03 in 2023, indicating a substantial increase in the company's ability to meet short-term obligations with cash on hand.
Overall, Ufp Industries Inc's liquidity ratios demonstrate a consistent improvement over the past five years, reflecting a strong liquidity position and the company's ability to easily meet its short-term financial commitments.
Additional liquidity measure
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 62.29 | 60.36 | 63.91 | 63.56 | 64.88 |
The cash conversion cycle of Ufp Industries Inc has exhibited fluctuations over the past five years. In 2023, the company's cash conversion cycle was 62.29 days, slightly higher than the previous year's figure of 60.36 days. The trend in recent years shows a relatively stable cycle, with slight variations seen in 2021 and 2022. Overall, the company has managed to maintain a relatively efficient cash conversion cycle, indicating its ability to efficiently manage its working capital and convert inventory and receivables into cash. The slight fluctuations in the cycle may be attributed to changes in the company's operations, sales patterns, or payment terms with customers and suppliers. Monitoring and managing the cash conversion cycle is crucial for Ufp Industries Inc to optimize cash flow and operational efficiency.