Vontier Corp (VNT)

Based on the provided data for Vontier Corp's liquidity ratios:

1. Current Ratio:
- Vontier Corp's current ratio has shown some fluctuations over the years, ranging from 1.39 to 1.58.
- The current ratio indicates the company's ability to cover its short-term liabilities with its current assets.
- A current ratio above 1 suggests that the company has more current assets than current liabilities, which is generally considered favorable.

2. Quick Ratio:
- Vontier Corp's quick ratio has varied between 0.90 and 1.23 during the period.
- The quick ratio measures the company's ability to meet its short-term obligations with its most liquid assets.
- A quick ratio above 1 indicates that the company can cover its short-term liabilities without relying on the sale of inventory.

3. Cash Ratio:
- Vontier Corp's cash ratio has ranged from 0.24 to 0.61, reflecting the company's cash position relative to its current liabilities.
- The cash ratio provides insight into the company's ability to settle its short-term debts using only its cash and cash equivalents.
- A higher cash ratio indicates a stronger ability to pay off short-term liabilities without relying on other current assets.

Overall, Vontier Corp's liquidity ratios suggest that the company has generally maintained a satisfactory liquidity position over the years, with the ability to meet its short-term obligations using its current assets and cash reserves. It is important for the company to continue monitoring and managing its liquidity effectively to ensure financial stability and operational flexibility.

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Additional liquidity measure

The cash conversion cycle of Vontier Corp has shown fluctuations over the past five years. As of December 31, 2020, the company's cash conversion cycle stood at 50.36 days, indicating the average number of days it takes for the company to convert its investments in raw materials into cash receipts from customers.

By December 31, 2021, there was a slight improvement in the cash conversion cycle, down to 50.15 days. However, by the end of 2022, the cycle increased to 60.20 days, reflecting a potential delay in receiving cash from sales compared to the previous year.

A notable improvement was observed by December 31, 2023, with the cash conversion cycle decreasing significantly to 38.58 days, suggesting the company managed its working capital more efficiently, leading to a quicker conversion of investments into cash.

However, by December 31, 2024, there was a reversal in this trend, as the cash conversion cycle increased to 58.40 days, indicating a potential challenge in converting the company's investments back into cash within the same period.

Overall, Vontier Corp's cash conversion cycle has shown variability over the years, highlighting the importance of efficient working capital management to ensure timely cash inflows and outflows.