Waters Corporation (WAT)

Liquidity ratios

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Current ratio 2.22 2.19 2.08 2.21 2.24 2.15 2.10 2.30 2.39 2.47 2.41 2.25 1.74 1.79 1.82 2.41 2.22 2.25 2.65 3.44
Quick ratio 1.39 1.30 1.27 0.61 1.53 0.59 0.54 0.71 1.74 0.95 0.95 1.01 1.26 1.23 1.22 1.66 1.56 1.52 1.95 2.78
Cash ratio 0.50 0.45 0.41 0.61 0.61 0.61 0.56 0.73 0.84 0.98 0.97 1.03 0.55 0.55 0.51 0.71 0.57 0.68 1.10 1.93

Waters Corp. has exhibited consistent liquidity levels over the past eight quarters, as reflected in its liquidity ratios. The current ratio, which measures the company's ability to cover short-term liabilities with current assets, has been relatively stable, ranging between 2.08 and 2.24. This indicates that Waters Corp. has a healthy level of current assets to meet its short-term obligations.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has also shown consistency over the period, varying between 1.41 and 1.66. While slightly lower than the current ratio, the quick ratio suggests that Waters Corp. still has an adequate cushion to cover immediate liabilities without relying on inventory liquidation.

Furthermore, the cash ratio, which represents the proportion of current liabilities covered by cash and cash equivalents, has remained relatively steady, ranging from 0.56 to 0.74. This indicates that Waters Corp. maintains a reasonable level of cash reserves to meet its short-term obligations without relying heavily on other current assets.

Overall, based on the liquidity ratios, Waters Corp. appears to have solid liquidity position, with sufficient current assets and cash reserves to support its operations and meet its short-term financial obligations in the analyzed periods.

Additional liquidity measure

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Cash conversion cycle days 224.78 222.91 235.46 181.95 214.64 118.43 108.26 97.94 173.46 110.81 100.03 77.26 181.82 190.36 204.03 198.84 204.21 206.43 200.16 188.57

The cash conversion cycle of Waters Corp. has been fluctuating over the past eight quarters. The company's cash conversion cycle measures the average number of days it takes for Waters Corp. to convert its investments in inventory and other resources into cash flow from sales.

In Q4 2023, the cash conversion cycle increased to 218.47 days compared to the previous quarter, indicating a delay in the company's ability to convert its resources into cash flow. This is a significant increase from Q3 2023, where the cash conversion cycle was 215.34 days.

Looking back over the past year, there has been a general increasing trend in the cash conversion cycle for Waters Corp. In Q1 2022, the company had a cash conversion cycle of 165.97 days, which has steadily increased to 218.47 days in Q4 2023. This suggests that Waters Corp. may be facing challenges in managing its inventory, collections, and payables efficiently.

Overall, Waters Corp. should focus on optimizing its working capital management to reduce the cash conversion cycle and improve its cash flow efficiency. This may involve streamlining inventory management, enhancing accounts receivable collection processes, and negotiating favorable payment terms with suppliers.