Visteon Corp (VC)

Visteon Corp's liquidity ratios indicate its ability to meet short-term obligations. The current ratio has shown a slight fluctuation over the years, ranging from 1.63 in 2020 to 1.74 in 2024. This suggests that the company's current assets are adequate to cover its current liabilities, with a generally stable trend.

However, the quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, shows a decrease from 0.67 in 2020 to 0.68 in 2024. This may indicate a slight decrease in Visteon's ability to quickly cover its short-term obligations without relying on inventory.

The cash ratio, which measures the company's ability to cover short-term liabilities with its most liquid assets, also follows a similar trend to the quick ratio, declining slightly from 0.67 in 2020 to 0.68 in 2024. This implies that Visteon may have a lower proportion of cash to cover its immediate obligations, which could pose a liquidity risk.

Overall, while Visteon Corp maintains a current ratio above 1, indicating a healthy liquidity position, the declining trend in the quick and cash ratios raises some concerns about the company's ability to meet short-term obligations using its most liquid assets.

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Additional liquidity measure

The cash conversion cycle of Visteon Corp has exhibited some fluctuations over the years based on the provided data. As of December 31, 2020, the company had a cash conversion cycle of 28.05 days, which increased to 37.96 days by December 31, 2021. The trend continued with a slight decrease to 37.49 days by December 31, 2022, followed by a further reduction to 31.37 days by December 31, 2023. The most recent data point, as of December 31, 2024, shows a slightly lower cash conversion cycle of 30.97 days.

Overall, Visteon Corp's cash conversion cycle has shown some variability but seems to have improved slightly in recent years. This metric reflects how efficiently the company manages its cash inflows and outflows, as well as its inventory and receivables turnover. The downward trend in the cash conversion cycle could indicate better inventory management or quicker collection of receivables, which may positively impact the company's liquidity and working capital efficiency. However, further analysis and comparison with industry benchmarks would provide a more comprehensive understanding of Visteon Corp's performance in this area.