Zurn Elkay Water Solutions Corporation (ZWS)

The liquidity ratios of Zurn Elkay Water Solutions Corporation show a consistent improvement over the years. The current ratio, which measures the company's ability to cover its short-term liabilities with its short-term assets, has increased steadily from 2.48 in 2019 to 3.02 in 2023. This indicates a stronger liquidity position and suggests that the company has ample current assets to meet its current obligations.

The quick ratio, a more conservative measure of liquidity that excludes inventory from current assets, also demonstrates improvement, rising from 1.59 in 2019 to 1.65 in 2023. This implies that the company has a more than sufficient ability to meet its short-term obligations without relying on selling inventory.

Furthermore, the cash ratio, which provides the most conservative measure of liquidity by only considering cash and cash equivalents to cover current liabilities, has shown a significant increase from 0.74 in 2019 to 0.62 in 2023. This indicates a stronger ability to cover immediate liabilities with available cash on hand.

Overall, the increasing trend in all three liquidity ratios suggests that Zurn Elkay Water Solutions Corporation has been effectively managing its liquidity and improving its short-term financial health over the years.

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Additional liquidity measure

The cash conversion cycle of Zurn Elkay Water Solutions Corporation has shown fluctuations over the past five years.

In 2023, the cash conversion cycle decreased to 145.68 days compared to the previous year, indicating an improvement in the company's efficiency in converting its investments in inventory and accounts receivable into cash.

In 2022, the cash conversion cycle increased to 179.47 days, which suggested that the company took longer to convert its investments into cash, potentially signaling inefficiencies in managing its working capital.

In 2021, the cash conversion cycle decreased to 124.90 days, showing a positive trend of the company being able to convert its investments into cash more efficiently compared to the previous year.

In 2020, the cash conversion cycle was at 86.64 days, which was notably lower than in the previous years, indicating a significant improvement in the company's working capital management and the speed of converting investments into cash.

In 2019, the cash conversion cycle stood at 96.06 days, which was relatively higher than in 2020, suggesting that the company had some inefficiencies in its working capital management during that period.

Overall, the fluctuations in the cash conversion cycle of Zurn Elkay Water Solutions Corporation over the past five years highlight the company's ability to manage its working capital effectively and efficiently convert investments into cash.