Vishay Intertechnology Inc (VSH)

Vishay Intertechnology Inc's current ratio has remained relatively stable over the past five years, ranging between 2.70 and 3.32. This indicates that the company has a strong ability to meet its short-term obligations with its current assets. However, there was a slight decrease in the current ratio in 2024 compared to the prior year.

On the other hand, the quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, shows a declining trend over the same period. The ratio decreased from 1.38 in 2020 to 0.86 in 2024. This suggests that the company's ability to cover its short-term liabilities with its most liquid assets (excluding inventory) has weakened over time.

The cash ratio, which is the most stringent liquidity ratio, has followed a similar downward trend as the quick ratio, falling from 1.38 in 2020 to 0.86 in 2024. This indicates that Vishay Intertechnology Inc's ability to settle its current liabilities solely with cash and cash equivalents has diminished over the years.

Overall, while the current ratio suggests that the company is in a favorable position to pay off its short-term debts, the declining trends in the quick and cash ratios may signify potential liquidity challenges that Vishay Intertechnology Inc could face in the future. It is important for the company to closely monitor its liquidity position and take necessary steps to improve its short-term financial health.

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Additional liquidity measure

The cash conversion cycle of Vishay Intertechnology Inc has shown fluctuations over the past five years. As of December 31, 2020, the company had a cash conversion cycle of 85.21 days, which decreased slightly to 83.24 days by December 31, 2021. However, the trend reversed in the following years, with the cycle increasing to 92.64 days by December 31, 2022, further rising to 97.36 days by the end of 2023, and reaching its peak at 108.87 days by December 31, 2024.

This indicates that the company took longer to convert its investments in inventory and receivables into cash in the latter years, leading to a longer cash conversion cycle. A longer cash conversion cycle could imply inefficiencies in managing working capital or potential liquidity challenges for the company. It is essential for the company to monitor and improve its cash conversion cycle to ensure optimal utilization of resources and maintain healthy liquidity levels.