WESCO International Inc (WCC)

Based on the provided data for WESCO International Inc, here is a comprehensive analysis of the liquidity ratios:

1. Current Ratio:
- The current ratio is a measure of a company's ability to cover its short-term liabilities with its short-term assets. WESCO International Inc's current ratio has shown consistent improvement over the years, increasing from 1.84 in 2020 to 2.20 in 2024. This indicates that the company has a strengthening ability to meet its short-term obligations with its current assets.

2. Quick Ratio:
- The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity as it excludes inventory from current assets. WESCO International Inc's quick ratio has fluctuated over the years but generally remained low, ranging from 0.07 to 0.18. This suggests that the company may have difficulty meeting its short-term obligations without relying on inventory.

3. Cash Ratio:
- The cash ratio is the most conservative liquidity ratio, focusing solely on the company's ability to cover its short-term liabilities with cash and cash equivalents. WESCO International Inc's cash ratio has followed a similar trend to the quick ratio, ranging from 0.07 to 0.18. The company appears to have a limited ability to cover its short-term obligations with cash alone.

In summary, while WESCO International Inc has demonstrated improvement in its current ratio over the years, the low quick ratio and cash ratio may indicate some limitations in the company's ability to quickly meet its short-term financial obligations without relying on inventory or cash equivalents. It is important for investors and stakeholders to closely monitor these liquidity ratios to assess the company's financial health and ability to manage liquidity effectively.

---

Additional liquidity measure

The cash conversion cycle of WESCO International Inc has shown some fluctuations over the years.

As of December 31, 2020, the cash conversion cycle was 78.99 days, indicating that the company took approximately 79 days to convert its investments in inventory and other resources into cash from sales.

By December 31, 2021, the cash conversion cycle had decreased to 67.46 days, suggesting an improvement in the efficiency of WESCO International's working capital management.

However, by December 31, 2022, the cash conversion cycle increased to 76.20 days, signaling a potential slowdown in the company's ability to convert its resources into cash.

Subsequently, by December 31, 2023, the cycle was 74.33 days, showing a slight decrease from the previous year but still above the levels seen in 2021.

As of December 31, 2024, the cash conversion cycle stood at 74.72 days, indicating a relatively stable position compared to the previous year.

Overall, it is essential for WESCO International Inc to closely monitor and manage its cash conversion cycle to ensure optimal efficiency in its working capital management and liquidity position.