Wolfspeed Inc (WOLF)
Liquidity ratios
| Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 4.51 | 4.58 | 5.13 | 5.44 | 5.74 | 4.69 | 6.70 | 4.61 | 4.54 | 5.70 | 3.37 | 3.86 | 3.29 | 4.18 | 3.84 | 4.33 | 5.47 | 4.89 | 5.20 | 5.57 |
| Quick ratio | 3.57 | 3.70 | 4.15 | 4.70 | 4.98 | 4.00 | 5.80 | 3.57 | 3.83 | 4.40 | 2.37 | 3.06 | 2.82 | 3.63 | 2.76 | 3.66 | 4.67 | 4.06 | 4.39 | 4.66 |
| Cash ratio | 3.27 | 3.51 | 3.93 | 4.47 | 4.71 | 3.70 | 5.40 | 3.14 | 3.09 | 3.99 | 2.01 | 2.69 | 2.57 | 3.38 | 2.51 | 3.32 | 4.26 | 3.39 | 3.83 | 4.10 |
Wolfspeed Inc's liquidity ratios show a generally healthy financial position over the past few quarters. The current ratio, which measures the company's ability to pay off its short-term liabilities with its current assets, has been consistently high, ranging from 3.29 to 6.70. This indicates that the company has ample current assets to cover its short-term obligations.
Similarly, the quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, also reflects a strong liquidity position for Wolfspeed Inc. The quick ratio has varied between 2.37 and 5.80, suggesting the company's ability to meet its short-term liabilities without relying on selling inventory.
The cash ratio, which is the most conservative measure of liquidity and evaluates the company's ability to cover its short-term liabilities with cash and cash equivalents alone, has been robust for Wolfspeed Inc. The cash ratio has ranged from 2.01 to 5.40, indicating that the company has a sufficient amount of cash on hand to meet its immediate obligations.
Overall, Wolfspeed Inc's liquidity ratios demonstrate a sound financial position with a strong ability to meet its short-term obligations.
Additional liquidity measure
| Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 234.60 | 219.22 | 200.66 | 194.75 | 170.95 | 179.42 | 138.88 | 164.68 | 238.41 | 177.97 | 175.07 | 177.49 | 132.72 | 89.00 | 73.02 | 76.07 | 55.79 | 99.73 | 75.88 | 73.28 |
The cash conversion cycle of Wolfspeed Inc has shown fluctuations over the periods analyzed. The cycle reflects the time it takes for the company to convert its investments in inventory and other resources into cash inflows from sales.
Analyzing the trend, it is observed that in the recent periods, the cash conversion cycle has been gradually increasing. This indicates that the company is taking longer to convert its investments into cash, which may suggest inefficiencies in its working capital management.
The peak in the cash conversion cycle occurred on Jun 30, 2022, with a value of 238.41 days, signifying a prolonged period for the company to generate cash from its operations. Subsequently, there was a significant decrease in the cycle on Mar 31, 2021, where it reached its lowest level of 73.02 days, reflecting a more efficient management of working capital during that period.
Overall, a longer cash conversion cycle may imply that Wolfspeed Inc is tying up more capital in its operations, potentially leading to liquidity challenges and decreased financial flexibility. Monitoring and potentially improving this metric could help enhance the company's financial health and operational efficiency.