Wolverine World Wide Inc (WWW)

Wolverine World Wide Inc's liquidity ratios show a fluctuating trend over the years. The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, decreased from 2.23 in 2020 to 1.19 in 2021, and further declined to 1.14 in 2022. However, there was a slight improvement in 2023 and 2024, with ratios of 1.18 and 1.29 respectively.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, exhibited a similar downward trend. It dropped significantly from 0.86 in 2020 to 0.21 in 2021 and continued to decline to 0.12 in 2022. Subsequently, there was a slight recovery in 2023 and 2024, with ratios of 0.21 and 0.29 respectively.

The cash ratio, which is the most conservative measure of liquidity focusing solely on cash and equivalents to cover current liabilities, showed the same pattern as the quick ratio. It fell from 0.86 in 2020 to 0.21 in 2021 and 0.12 in 2022, then increased slightly to 0.21 in 2023 and 0.29 in 2024.

Overall, Wolverine World Wide Inc's liquidity position weakened from 2020 to 2022 before showing some signs of improvement in 2023 and 2024. Management should closely monitor these ratios to ensure the company maintains adequate liquidity to meet its short-term obligations.

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Additional liquidity measure

The cash conversion cycle for Wolverine World Wide Inc has experienced fluctuations over the past five years. In 2020, the company had a cash conversion cycle of 84.07 days, indicating a relatively efficient management of working capital. However, by the end of 2022, the cash conversion cycle significantly increased to 168.48 days, suggesting potential challenges in converting inventory and receivables into cash.

During 2021 and 2024, the cash conversion cycle improved to 96.32 days and 90.21 days respectively, indicating better efficiency in managing cash flow and working capital. The company was able to reduce the time it takes to convert resources into cash during those periods.

By the end of 2023, the cash conversion cycle was at 99.51 days, showing a slight increase compared to the previous year. Overall, the trend in the cash conversion cycle for Wolverine World Wide Inc seems to be somewhat volatile, with fluctuations across the years. It is essential for the company to closely monitor and optimize its working capital management to ensure smooth operations and financial stability.