Sign in Sign up for free

The Rowe Companies Current ratio

What is the Current ratio of The Rowe Companies?

The Current ratio of The Rowe Companies, Inc. is 1.30

What is the definition of Current ratio?



Current ratio is a liquidity ratio that measures whether or not a company has enough resources to meet its short-term obligations.

mrq (most recent quarter)

The current ratio is an indication of a company's liquidity and measures the capability to meet a company's short-term obligations. It compares a firm's current assets to its current liabilities, and is expressed as current assets divided by current liabilities. The ratio is only useful when two companies are compared within industry because inter industry business operations differ substantially. To determine liquidity, the current ratio is not as helpful as the quick ratio, because it includes all those assets that may not be easily liquidated, like prepaid expenses and inventory.

Acceptable current ratios vary from industry to industry. In many cases an investor would consider a high current ratio to be better than a low current ratio, because a high current ratio indicates that the company is more likely to pay the investor back. Large current ratios are not always a good sign for investors. If the company's current ratio is too high it may indicate that the company is not efficiently using its current assets or its short-term financing facilities. If current liabilities exceed current assets the current ratio will be less than 1. A current ratio of less than 1 indicates that the company may have problems meeting its short-term obligations.

Some types of businesses can operate with a current ratio of less than one however. If inventory turns into cash much more rapidly than the accounts payable become due, then the firm's current ratio can comfortably remain less than one. Inventory is valued at the cost of acquiring it and the firm intends to sell the inventory for more than this cost. The sale will therefore generate substantially more cash than the value of inventory on the balance sheet. Low current ratios can also be justified for businesses that can collect cash from customers long before they need to pay their suppliers.

Current ratio of companies in the Consumer Discretionary sector on OTC compared to The Rowe Companies

What does The Rowe Companies do?

The Rowe Companies, Inc. is a holding company, which through its subsidiaries manufactures and markets home furnishings in the United States. The company operates in two segments, Wholesale Home Furnishings and Retail Home Furnishings. The Wholesale Home Furnishings segment designs and manufactures upholstered furniture, including sofas, loveseats, benches, ottomans and chairs, occasional chairs, and sleep sofas covered with fabric, as well as finished leather accent pieces, such as chairs, benches, and ottomans. The Retail Home Furnishings segment offers upholstered furniture, leather furniture, case goods, dining sets, rugs, and home accessories through company-owned stores, catalog, and Internet. The Rowe Companies, Inc. was formerly known as Rowe Furniture Corporation and changed its name to The Rowe Companies, Inc. in March 1999. The Rowe Companies, Inc. was founded in 1946 and is based in McLean, Virginia. On September 18, 2006, The Rowe Companies, Inc. filed a voluntary petition for reorganization under Chapter 11 in the US Bankruptcy Court for the Eastern District of Virginia, Alexandria. The plan was later approved as Chapter 11 liquidation October 25, 2007.

Companies with current ratio similar to The Rowe Companies