Wynn Resorts Limited (WYNN)

Wynn Resorts Ltd. has demonstrated a consistent and healthy liquidity position over the past five years, as evidenced by its current, quick, and cash ratios.

The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, has shown a stable trend from 2019 to 2021 before experiencing a slight decrease in 2022 and 2023. Although the current ratio declined in recent years, it remained above 2.0, indicating that Wynn Resorts has more than enough current assets to meet its short-term obligations.

Similarly, the quick ratio, which focuses on the ability to meet short-term obligations with liquid assets, such as cash and marketable securities, also reflected a positive liquidity position for Wynn Resorts. The company's quick ratio has consistently remained above 2.0 over the past five years, providing further evidence of its strong liquidity.

The cash ratio, which is the most stringent liquidity measure as it only considers cash and cash equivalents, exhibited a stable and favorable trend for Wynn Resorts. The cash ratio remained above 1.2 every year, indicating that the company holds sufficient cash to cover its current liabilities without relying on the sale of inventory or other current assets.

Overall, Wynn Resorts Ltd. has maintained solid liquidity ratios over the years, signaling its ability to meet its short-term obligations comfortably. This stable liquidity position enhances the company's financial flexibility and resilience in the face of unforeseen challenges or opportunities.

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Additional liquidity measure

The cash conversion cycle of Wynn Resorts Ltd. has shown fluctuations over the last five years.

In 2023, the cash conversion cycle was 6.02 days, which indicates that on average it takes the company 6.02 days to convert its investments in inventory and other resources into cash received from sales. This represents an increase from 2022 when the cycle was 1.48 days, suggesting a longer turnaround time in converting resources into cash.

The cycle was 5.16 days in 2021 and 17.65 days in 2020. The significant increase in 2020 may indicate potential difficulties in managing working capital efficiently, resulting in a longer time to convert assets into cash. However, the cycle decreased to 3.52 days in 2019, reflecting improved efficiency in the cash conversion process.

Overall, Wynn Resorts Ltd. should strive to maintain a shorter cash conversion cycle as it indicates better liquidity and operational efficiency. Efforts to manage working capital effectively can help the company shorten its cash conversion cycle and improve its financial health.