Vicor Corporation (VICR)

Vicor Corp.'s liquidity ratios have shown a consistent trend of improvement over the past five years. The current ratio, a measure of the company's ability to cover its short-term liabilities with its current assets, has increased from 5.98 in 2019 to 9.52 in 2023. This indicates that Vicor Corp. has significantly improved its liquidity position and has more than enough current assets to cover its short-term obligations.

Similarly, the quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has also shown a positive trend, increasing from 4.34 in 2019 to 7.10 in 2023. This suggests that the company has a strong ability to meet its short-term liabilities without relying on selling inventory.

Furthermore, the cash ratio, which measures the company's ability to cover its short-term liabilities with its cash and cash equivalents, has also improved from 3.07 in 2019 to 5.91 in 2023. This indicates that Vicor Corp. has a solid cash position to meet its immediate obligations.

Overall, Vicor Corp.'s liquidity ratios paint a positive picture, showcasing the company's strong liquidity position and its ability to meet its short-term obligations comfortably. This trend of improvement suggests that the company has been managing its liquidity effectively and is well-positioned to address any short-term financial challenges that may arise.

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Additional liquidity measure

The cash conversion cycle of Vicor Corp. has shown a fluctuating trend over the past five years. In 2023, the company's cash conversion cycle was 219.74 days, indicating that it takes the company approximately 219.74 days to convert its investments in inventory and other resources into cash inflows from sales. This represents an increase from the previous year, where the cycle was 192.14 days.

Looking further back, the trend reveals that in 2021, the cash conversion cycle was 148.91 days, which was a notable improvement from 2020, where it was 145.83 days. However, in 2019, the cycle was 157.65 days, showing a slight increase compared to the following years.

Overall, the fluctuation in Vicor Corp.'s cash conversion cycle suggests varying efficiencies in managing inventory, accounts receivable, and accounts payable. A longer cash conversion cycle indicates that the company is taking more time to generate cash from its operational activities, which could have implications for its working capital management and overall liquidity position.