Xerox Corp (XRX)

Liquidity ratios

Dec 31, 2024 Sep 30, 2024 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
Current ratio 1.12 1.26 1.49 1.37 1.14 1.12 1.15 1.26 1.23 1.17 1.20 1.21 1.66 1.88 1.92 2.05 2.33 1.97 1.42
Quick ratio 0.52 0.65 0.77 0.85 0.49 0.71 0.73 0.49 0.57 0.53 0.59 0.93 1.31 1.49 1.50 1.60 1.85 1.56 1.08
Cash ratio 0.22 0.21 0.24 0.28 0.19 0.18 0.16 0.21 0.31 0.28 0.34 0.45 0.65 0.79 0.79 0.90 1.06 0.97 0.60

Xerox Corp's liquidity ratios have fluctuated over the years. The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, has shown a general declining trend from 2022 to 2024, indicating a potential deterioration in short-term liquidity. The current ratio stood at a relatively healthy level of 2.33 in December 2020 but declined to 1.14 by December 2023 before recovering slightly to 1.12 by September 2024.

Similarly, the quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, also showed a declining trend over the same period, further highlighting potential liquidity challenges. The quick ratio decreased from 1.85 in December 2020 to 0.52 by December 2024, signaling a significant decrease in the company's ability to meet its short-term obligations with its most liquid assets.

Furthermore, the cash ratio, which specifically focuses on the ability to cover current liabilities with cash and cash equivalents, also exhibited a decreasing trend from 2020 to 2024. The cash ratio declined from 1.06 in December 2020 to 0.22 by December 2024, indicating a decrease in the company's ability to pay off its short-term liabilities solely with its cash reserves.

Overall, the declining trends in Xerox Corp's liquidity ratios suggest a potential liquidity strain on the company's operations, emphasizing the importance of closely monitoring its short-term financial health and cash management practices.

Additional liquidity measure

Dec 31, 2024 Sep 30, 2024 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
Cash conversion cycle days -18.05 29.20 24.73 21.12 -24.12 25.44 35.73 -40.48 -52.69 -36.91 -38.34 9.11 24.32 53.21 73.78 79.65 77.66 86.45 82.84

The cash conversion cycle of Xerox Corp has exhibited fluctuations over the periods analyzed. Initially, the company had a relatively high cash conversion cycle, indicating a longer time to convert its investments in inventory and other resources back into cash. However, there was a significant improvement in the company's efficiency as the cash conversion cycle declined steadily.

By the end of December 2021, Xerox Corp had notably reduced its cash conversion cycle to just 24.32 days, reflecting a more efficient management of working capital. The trend continued positively, with the cash conversion cycle reaching negative days in the subsequent quarters, indicating that Xerox was converting its cash more rapidly than investing in inventory and accounts receivable.

Although there were some fluctuations in the cash conversion cycle in the following periods, Xerox maintained relatively lower days on average compared to the initial periods. This trend suggests that Xerox Corp has been more efficient in managing its working capital and converting its investments into cash.

Overall, the decreasing trend in the cash conversion cycle shows an improvement in Xerox Corp's operational efficiency in managing its cash flow and working capital. This could positively impact the company's liquidity position and financial performance over the periods analyzed.