Walmart Inc (WMT)
Liquidity ratios
| Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | Jan 31, 2020 | Oct 31, 2019 | Jul 31, 2019 | Apr 30, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 0.83 | 0.85 | 0.83 | 0.82 | 0.82 | 0.86 | 0.84 | 0.86 | 0.93 | 0.95 | 0.96 | 0.95 | 0.97 | 0.84 | 0.79 | 0.77 | 0.79 | 0.81 | 0.76 | 0.77 |
| Quick ratio | 0.29 | 0.20 | 0.22 | 0.19 | 0.30 | 0.20 | 0.21 | 0.20 | 0.41 | 0.28 | 0.37 | 0.37 | 0.42 | 0.37 | 0.39 | 0.24 | 0.27 | 0.17 | 0.18 | 0.18 |
| Cash ratio | 0.20 | 0.12 | 0.14 | 0.11 | 0.21 | 0.11 | 0.14 | 0.12 | 0.32 | 0.20 | 0.29 | 0.29 | 0.35 | 0.31 | 0.33 | 0.18 | 0.19 | 0.10 | 0.12 | 0.12 |
Walmart Inc's liquidity ratios show fluctuations over the periods analyzed. The current ratio, measuring the company's ability to cover short-term obligations with current assets, has been mostly below 1, indicating potential liquidity concerns in the short term. The quick ratio, a more stringent measure excluding inventory from current assets, has also been relatively low, suggesting a limited ability to meet immediate obligations without relying on inventory sales. The cash ratio, indicating the company's ability to cover its current liabilities with cash and cash equivalents, has exhibited some improvement but remains at relatively low levels.
Overall, Walmart Inc's liquidity ratios indicate a need for careful monitoring of its ability to manage short-term financial obligations effectively. The company may need to focus on optimizing its working capital management and cash flow generation to enhance its liquidity position and ensure continued financial stability.
See also:
Additional liquidity measure
| Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | Jan 31, 2020 | Oct 31, 2019 | Jul 31, 2019 | Apr 30, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 3.52 | 7.12 | 4.68 | 6.55 | 6.97 | 10.98 | 9.39 | 11.87 | 6.34 | 4.97 | 2.34 | 2.23 | 0.61 | 1.80 | -1.24 | 0.83 | 2.03 | 5.60 | 2.16 | 3.44 |
The cash conversion cycle is a key metric that measures how long it takes for a company to convert its investments in inventory and other resources into cash flows from sales. Walmart Inc's cash conversion cycle has shown some fluctuation over the past two years.
At the end of January 2024, Walmart's cash conversion cycle stood at 3.52 days, indicating that the company is efficient in managing its inventory, accounts receivable, and accounts payable to generate cash quickly from its operations. This is a positive sign for the company's liquidity position.
Looking back at the historical trend, the cash conversion cycle has varied significantly over the past two years, ranging from negative values to double-digit positive values. This fluctuation suggests potential changes in the efficiency of Walmart's operations, including inventory management and collection of receivables.
Analyzing the trend further, there are periods where the cash conversion cycle has been relatively high, such as in July 2022 and April 2022, indicating a longer time taken to convert resources into cash. Conversely, there are periods like in January 2021 where the cycle was notably low, suggesting improved efficiency in cash conversion.
Overall, a lower cash conversion cycle is generally preferred as it indicates that the company is able to generate cash quickly from its operations. However, it is important to assess the factors driving the changes in the cycle to ensure sustainable operational efficiency and financial health for Walmart Inc.