Ufp Industries Inc (UFPI)

1. Current Ratio:
- The current ratio measures the company's ability to cover its short-term obligations with its current assets. A higher current ratio indicates a better ability to meet short-term obligations.

- Ufp Industries Inc's current ratio decreased from 3.32 in 2020 to 2.67 in 2021, but improved significantly to 4.41 in 2023. This indicates that the company's liquidity position strengthened over the years, except for a decline in 2024 to 2.46.

2. Quick Ratio:
- The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity as it excludes inventory from current assets. A ratio above 1 indicates that the company can meet its short-term obligations without relying on selling inventory.

- Ufp Industries Inc's quick ratio was below 1 in 2021 at 0.42, suggesting potential liquidity issues. However, it improved notably in 2023 and 2024 to 2.03 and 2.35, respectively, indicating a significant enhancement in the company's ability to cover its short-term obligations without relying on inventory sales.

3. Cash Ratio:
- The cash ratio is the most conservative measure of liquidity, focusing solely on the company's ability to cover its current liabilities with cash and cash equivalents.

- Ufp Industries Inc's cash ratio fluctuated between 0.42 and 2.35 over the years, reflecting variations in the company's cash position relative to its current liabilities. The increase in the cash ratio from 2021 to 2024 suggests an improved ability to settle short-term obligations with cash on hand.

Overall, Ufp Industries Inc's liquidity ratios show fluctuations over the years, with improvements in certain ratios indicating enhanced liquidity and ability to meet short-term financial obligations effectively. It is essential for the company to continue monitoring and managing its liquidity position to ensure a healthy financial standing.

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Additional liquidity measure

The cash conversion cycle for Ufp Industries Inc has shown some fluctuations over the years. As of December 31, 2020, the company's cash conversion cycle stood at 47.56 days, exhibiting a slight increase to 48.64 days by December 31, 2021. However, there was a notable improvement in efficiency by December 31, 2022, with the cycle decreasing to 45.33 days. The trend continued with a slight increase to 45.80 days by December 31, 2023, before rising again to 48.49 days by December 31, 2024.

Overall, Ufp Industries Inc's cash conversion cycle has shown variability but has generally remained within a relatively narrow range. It is essential for the company to monitor and manage its cash conversion cycle effectively to ensure optimal working capital management and operational efficiency.