Analysis of Liquidity Ratios
Quarterly Data
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
Biogen Inc., liquidity ratios (quarterly data)
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
- Current Ratio
- The current ratio shows fluctuation over the observed periods, starting at a high level of 3.23 in the first quarter of 2018 and generally trending downward with intermittent recoveries. The ratio reached its lowest point around the fourth quarter of 2019 at 1.72, indicating a reduction in the company's short-term liquidity relative to current liabilities. A recovery trend is visible from mid-2020 onward, with the ratio gradually increasing again and peaking at 2.49 in the third quarter of 2022. This suggests an improvement in the company's ability to cover current liabilities with current assets towards the end of the period.
- Quick Ratio
- The quick ratio follows a somewhat similar pattern to the current ratio but remains consistently lower due to the exclusion of inventory from liquid assets. It started at 2.67 in the first quarter of 2018 and declined sharply to 1.43 by the fourth quarter of 2019, suggesting a tightening in immediate liquidity. After this low, there were some recoveries and declines, with slight improvement noted in 2021 and 2022. By the third quarter of 2022, the quick ratio rose to 1.76, reflecting a somewhat improved but still moderate ability to meet short-term obligations without relying on inventory.
- Cash Ratio
- The cash ratio demonstrates the most conservative liquidity measure, focusing solely on cash and cash equivalents. Beginning at 1.88 in early 2018, the ratio declined steadily and reached a low of 0.7 several times, notably in the last quarter of 2020 and the third quarter of 2021, indicating reduced cash reserves relative to current liabilities. However, a recovery trend is observed from early 2022, with the cash ratio increasing to 1.25 by the third quarter of 2022. This denotes a strengthening of immediate liquidity by the end of the evaluated period.
- General Observations
- All three liquidity ratios depict an overall decline in the company’s short-term financial strength from early 2018 to around 2019, followed by a period of relative stabilization and gradual recovery starting approximately in mid-2020. Although the current ratio remains the highest among the three, all ratios follow a consistent pattern of weakening liquidity in the initial years and moderate improvement in the most recent quarters analyzed. The trends suggest active management of liquid assets and liabilities, with a cautious approach to maintaining cash reserves in more recent periods.
Current Ratio
Biogen Inc., current ratio calculation (quarterly data)
| 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 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Current assets | 9,765,800) | 9,740,900) | 7,915,900) | 7,856,500) | 7,162,300) | 7,183,700) | 6,719,500) | 6,887,100) | 7,843,100) | 8,493,800) | 8,007,200) | 8,381,800) | 8,448,200) | 7,909,800) | 8,942,600) | 7,640,900) | 8,719,000) | 7,432,100) | 10,195,400) | ||||||
| Current liabilities | 3,926,400) | 5,018,000) | 3,946,600) | 4,298,200) | 4,211,600) | 3,347,200) | 3,165,800) | 3,742,200) | 3,804,000) | 3,447,100) | 4,638,600) | 4,863,800) | 4,432,200) | 3,210,900) | 3,148,700) | 3,295,200) | 3,174,900) | 3,152,400) | 3,152,100) | ||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Current ratio1 | 2.49 | 1.94 | 2.01 | 1.83 | 1.70 | 2.15 | 2.12 | 1.84 | 2.06 | 2.46 | 1.73 | 1.72 | 1.91 | 2.46 | 2.84 | 2.32 | 2.75 | 2.36 | 3.23 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Current Ratio, Competitors2 | |||||||||||||||||||||||||
| AbbVie Inc. | 0.93 | 0.84 | 0.82 | 0.79 | 1.01 | 0.91 | 0.83 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Amgen Inc. | 1.68 | 1.53 | 1.44 | 1.59 | 1.64 | 1.31 | 1.66 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Bristol-Myers Squibb Co. | 1.42 | 1.44 | 1.32 | 1.52 | 1.47 | 1.54 | 1.56 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Danaher Corp. | 1.78 | 1.75 | 1.68 | 1.43 | 1.48 | 2.26 | 2.05 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Eli Lilly & Co. | 1.13 | 1.10 | 1.27 | 1.23 | 1.30 | 1.15 | 1.42 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Gilead Sciences Inc. | 1.30 | 1.43 | 1.48 | 1.27 | 1.37 | 1.36 | 1.37 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Johnson & Johnson | 1.43 | 1.42 | 1.39 | 1.35 | 1.34 | 1.39 | 1.28 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Merck & Co. Inc. | 1.46 | 1.39 | 1.40 | 1.27 | 1.31 | 1.31 | 1.02 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Pfizer Inc. | 1.59 | 1.42 | 1.39 | 1.40 | 1.39 | 1.37 | 1.48 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Regeneron Pharmaceuticals Inc. | 5.36 | 5.12 | 4.76 | 3.56 | 3.71 | 3.57 | 3.12 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Thermo Fisher Scientific Inc. | 1.74 | 1.65 | 1.56 | 1.50 | 3.19 | 2.78 | 2.53 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Vertex Pharmaceuticals Inc. | 4.70 | 4.50 | 4.75 | 4.46 | 4.62 | 4.61 | 4.39 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Current ratio = Current assets ÷ Current liabilities
= 9,765,800 ÷ 3,926,400 = 2.49
2 Click competitor name to see calculations.
- Current Assets
- The quarterly current assets exhibit volatility over the observed periods. Initially, there was a notable decline from approximately 10.2 billion USD in early 2018 to around 7.4 billion USD by mid-2018. This was followed by fluctuations, with current assets climbing back near the high of 8.9 billion USD by the first quarter of 2019 and then decreasing again towards the end of 2020. A gradual recovery appeared in 2021 with a modest rise towards the end of the year, culminating in a significant increase in mid-2022, reaching close to 9.8 billion USD. This indicates variability in short-term resource levels, suggesting adjustments in operational liquidity or working capital management across periods.
- Current Liabilities
- Current liabilities showed a different pattern, with relative stability in early 2018, maintaining around 3.1 billion USD through the first two quarters. However, starting in late 2018, liabilities increased markedly, peaking near 4.9 billion USD by the end of 2019. The amount then decreased to approximately 3.4 billion USD mid-2020, followed by oscillations between approximately 3.1 billion USD and 5.0 billion USD during 2021 and 2022. This variability in current liabilities suggests fluctuations in the company's short-term obligations, possibly reflecting changes in payables, accrued expenses, or debt management strategies.
- Current Ratio
- The current ratio, reflecting liquidity by comparing current assets to current liabilities, declined notably from a high of 3.23 in early 2018 to a low near 1.7 by the end of 2019. This downward trend signifies a reduction in available current assets relative to obligations, potentially indicating tightening liquidity in that period. Despite some recovery observed in 2020 with a ratio rising above 2.0 at times, the ratio again declined in late 2021, reaching about 1.7. The ratio improved afterward, rising to approximately 2.5 by the third quarter of 2022, suggesting enhanced liquidity and a more comfortable coverage of current liabilities. The fluctuations in the current ratio, alongside the changes in assets and liabilities, point to ongoing adjustments in the company's short-term financial position.
- Overall Analysis
- The financial data reveals considerable variability in the company's short-term financial indicators over the examined quarters. Current assets and liabilities both underwent significant swings, impacting liquidity metrics. The company's liquidity, as measured by the current ratio, deteriorated markedly toward the end of 2019 before recovering moderately in subsequent years. The recent increase in the current ratio and current assets in mid-2022 potentially signals a strengthening in the short-term financial position. The trends suggest active management of working capital with periods of tightening followed by stabilization and improvement.
Quick Ratio
Biogen Inc., quick ratio calculation (quarterly data)
| 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 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Cash and cash equivalents | 3,675,600) | 2,646,600) | 1,749,300) | 2,261,400) | 1,541,800) | 1,742,000) | 1,217,500) | 1,331,200) | 2,224,800) | 2,384,900) | 2,591,300) | 2,913,700) | 2,343,900) | 1,723,400) | 2,243,200) | 1,224,600) | 2,386,700) | 1,250,200) | 4,108,000) | ||||||
| Marketable securities | 1,235,500) | 2,151,300) | 2,002,400) | 1,541,100) | 1,413,300) | 1,308,800) | 1,320,000) | 1,278,900) | 1,355,000) | 1,942,700) | 1,269,100) | 1,562,200) | 2,093,500) | 1,228,800) | 1,665,800) | 2,313,400) | 2,041,700) | 1,974,000) | 1,808,000) | ||||||
| Accounts receivable, net | 1,568,800) | 1,567,600) | 1,632,000) | 1,549,400) | 1,723,000) | 1,688,000) | 1,854,300) | 1,913,800) | 2,024,900) | 2,133,600) | 2,092,600) | 1,880,500) | 1,933,500) | 1,959,600) | 2,088,900) | 1,958,500) | 2,017,300) | 1,951,000) | 1,939,200) | ||||||
| Due from anti-CD20 therapeutic programs | 415,400) | 435,900) | 389,400) | 412,300) | 400,000) | 422,200) | 369,800) | 413,500) | 527,200) | 441,100) | 511,600) | 590,200) | 582,300) | 557,500) | 527,100) | 526,900) | 508,400) | 481,900) | 553,500) | ||||||
| Total quick assets | 6,895,300) | 6,801,400) | 5,773,100) | 5,764,200) | 5,078,100) | 5,161,000) | 4,761,600) | 4,937,400) | 6,131,900) | 6,902,300) | 6,464,600) | 6,946,600) | 6,953,200) | 5,469,300) | 6,525,000) | 6,023,400) | 6,954,100) | 5,657,100) | 8,408,700) | ||||||
| Current liabilities | 3,926,400) | 5,018,000) | 3,946,600) | 4,298,200) | 4,211,600) | 3,347,200) | 3,165,800) | 3,742,200) | 3,804,000) | 3,447,100) | 4,638,600) | 4,863,800) | 4,432,200) | 3,210,900) | 3,148,700) | 3,295,200) | 3,174,900) | 3,152,400) | 3,152,100) | ||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Quick ratio1 | 1.76 | 1.36 | 1.46 | 1.34 | 1.21 | 1.54 | 1.50 | 1.32 | 1.61 | 2.00 | 1.39 | 1.43 | 1.57 | 1.70 | 2.07 | 1.83 | 2.19 | 1.79 | 2.67 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Quick Ratio, Competitors2 | |||||||||||||||||||||||||
| AbbVie Inc. | 0.69 | 0.61 | 0.56 | 0.56 | 0.75 | 0.65 | 0.61 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Amgen Inc. | 1.17 | 0.99 | 0.90 | 1.06 | 1.19 | 0.86 | 1.16 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Bristol-Myers Squibb Co. | 0.98 | 1.07 | 1.03 | 1.20 | 1.16 | 1.16 | 1.25 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Danaher Corp. | 1.19 | 1.13 | 1.08 | 0.89 | 0.93 | 1.67 | 1.51 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Eli Lilly & Co. | 0.71 | 0.67 | 0.77 | 0.80 | 0.79 | 0.67 | 0.83 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Gilead Sciences Inc. | 0.96 | 1.06 | 1.06 | 0.95 | 1.01 | 1.05 | 0.99 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Johnson & Johnson | 1.10 | 1.09 | 1.06 | 1.04 | 1.03 | 1.04 | 0.97 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Merck & Co. Inc. | 0.90 | 0.85 | 0.84 | 0.73 | 0.78 | 0.75 | 0.58 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Pfizer Inc. | 1.18 | 1.02 | 0.95 | 1.00 | 0.99 | 0.91 | 0.88 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Regeneron Pharmaceuticals Inc. | 4.37 | 4.20 | 3.95 | 2.98 | 3.03 | 2.92 | 2.39 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Thermo Fisher Scientific Inc. | 1.06 | 0.98 | 0.97 | 1.00 | 2.37 | 1.92 | 1.70 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Vertex Pharmaceuticals Inc. | 4.28 | 4.14 | 4.37 | 4.04 | 4.21 | 4.16 | 4.06 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 6,895,300 ÷ 3,926,400 = 1.76
2 Click competitor name to see calculations.
- Total quick assets
- The total quick assets displayed notable fluctuations over the observed periods. Initially, there was a significant decline from 8,408,700 thousand US dollars at the end of March 2018 to 5,657,100 thousand US dollars by June 2018. This was followed by intermittent recoveries and decreases, with peaks observed around December 2019 at approximately 6,946,600 thousand US dollars. During 2020, quick assets experienced volatility, decreasing markedly towards the end of the year, reaching a low of 4,937,400 thousand US dollars in December 2020. From early 2021 onwards, quick assets showed a moderate upward trend, rising from around 4,761,600 thousand US dollars in March 2021 to nearly 6,895,300 thousand US dollars by September 2022.
- Current liabilities
- Current liabilities remained relatively stable in 2018, hovering around 3,150,000 to 3,295,000 thousand US dollars. In the latter half of 2019, they increased substantially to approximately 4,863,800 thousand US dollars by December 2019. During 2020, current liabilities fluctuated, initially decreasing to 3,447,100 thousand US dollars in June but rising again at the year-end. The data suggests volatility, with significant spikes in September 2021 and June 2022, where liabilities reached over 5,000,000 thousand US dollars. By September 2022, liabilities had decreased somewhat to 3,926,400 thousand US dollars, indicating a non-linear movement over the full period.
- Quick ratio
- The quick ratio exhibited a declining trend from a high of 2.67 at March 2018 to a low of 1.21 in September 2021. Early in the timeframe, the ratio saw a steep drop within the first quarters of 2018, followed by fluctuating decreases through 2019. The quick ratio dipped below 1.5 for much of the period from late 2019 to mid-2021, suggesting a tighter liquidity position during this time. After reaching its minimum, the quick ratio experienced a recovery starting in late 2021, climbing to 1.76 by September 2022. This recovery indicates an improvement in short-term liquidity and the company's capacity to cover its current liabilities without relying on inventory.
- Overall analysis
- Over the observed quarters, the company's liquidity position was characterized by volatility in quick assets and current liabilities, directly influencing the quick ratio dynamics. The initial sharp drop in quick assets and quick ratio during 2018 possibly reflects a period of resource reallocation or operational challenges. The increase in current liabilities towards the end of 2019, alongside inconsistent quick asset levels, contributed to reduced liquidity ratios during 2019 and 2020. The lowest quick ratio in 2021 corresponds to the lowest quick asset levels and relatively high liabilities, implying a period of constrained short-term financial flexibility. Subsequently, both quick assets and the quick ratio improved significantly by 2022, indicating enhanced liquidity and potentially stronger financial management or operational performance in recent quarters. This suggests the company has been actively working to strengthen its ability to meet short-term obligations.
Cash Ratio
Biogen Inc., cash ratio calculation (quarterly data)
| 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 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Cash and cash equivalents | 3,675,600) | 2,646,600) | 1,749,300) | 2,261,400) | 1,541,800) | 1,742,000) | 1,217,500) | 1,331,200) | 2,224,800) | 2,384,900) | 2,591,300) | 2,913,700) | 2,343,900) | 1,723,400) | 2,243,200) | 1,224,600) | 2,386,700) | 1,250,200) | 4,108,000) | ||||||
| Marketable securities | 1,235,500) | 2,151,300) | 2,002,400) | 1,541,100) | 1,413,300) | 1,308,800) | 1,320,000) | 1,278,900) | 1,355,000) | 1,942,700) | 1,269,100) | 1,562,200) | 2,093,500) | 1,228,800) | 1,665,800) | 2,313,400) | 2,041,700) | 1,974,000) | 1,808,000) | ||||||
| Total cash assets | 4,911,100) | 4,797,900) | 3,751,700) | 3,802,500) | 2,955,100) | 3,050,800) | 2,537,500) | 2,610,100) | 3,579,800) | 4,327,600) | 3,860,400) | 4,475,900) | 4,437,400) | 2,952,200) | 3,909,000) | 3,538,000) | 4,428,400) | 3,224,200) | 5,916,000) | ||||||
| Current liabilities | 3,926,400) | 5,018,000) | 3,946,600) | 4,298,200) | 4,211,600) | 3,347,200) | 3,165,800) | 3,742,200) | 3,804,000) | 3,447,100) | 4,638,600) | 4,863,800) | 4,432,200) | 3,210,900) | 3,148,700) | 3,295,200) | 3,174,900) | 3,152,400) | 3,152,100) | ||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Cash ratio1 | 1.25 | 0.96 | 0.95 | 0.88 | 0.70 | 0.91 | 0.80 | 0.70 | 0.94 | 1.26 | 0.83 | 0.92 | 1.00 | 0.92 | 1.24 | 1.07 | 1.39 | 1.02 | 1.88 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Cash Ratio, Competitors2 | |||||||||||||||||||||||||
| AbbVie Inc. | 0.36 | 0.29 | 0.23 | 0.28 | 0.43 | 0.30 | 0.31 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Amgen Inc. | 0.80 | 0.57 | 0.51 | 0.66 | 0.87 | 0.55 | 0.82 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Bristol-Myers Squibb Co. | 0.48 | 0.63 | 0.66 | 0.78 | 0.73 | 0.68 | 0.75 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Danaher Corp. | 0.64 | 0.53 | 0.49 | 0.32 | 0.35 | 1.07 | 0.93 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Eli Lilly & Co. | 0.18 | 0.18 | 0.19 | 0.26 | 0.28 | 0.22 | 0.26 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Gilead Sciences Inc. | 0.54 | 0.61 | 0.62 | 0.56 | 0.56 | 0.64 | 0.58 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Johnson & Johnson | 0.75 | 0.73 | 0.70 | 0.70 | 0.70 | 0.65 | 0.60 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Merck & Co. Inc. | 0.49 | 0.44 | 0.40 | 0.34 | 0.42 | 0.39 | 0.26 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Pfizer Inc. | 0.82 | 0.70 | 0.61 | 0.73 | 0.71 | 0.61 | 0.51 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Regeneron Pharmaceuticals Inc. | 2.44 | 2.49 | 2.34 | 1.45 | 1.56 | 1.05 | 1.09 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Thermo Fisher Scientific Inc. | 0.26 | 0.17 | 0.23 | 0.33 | 1.55 | 1.01 | 0.80 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Vertex Pharmaceuticals Inc. | 3.74 | 3.62 | 3.78 | 3.51 | 3.64 | 3.65 | 3.56 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2022 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 4,911,100 ÷ 3,926,400 = 1.25
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several notable trends related to liquidity and short-term financial stability.
- Total Cash Assets
- Over the observed periods, total cash assets experienced significant fluctuations. Initially, there was a peak at the end of the first quarter of 2018, reaching 5,916 million US dollars, followed by a sharp decline in the following quarters. Subsequently, cash levels exhibited a cyclical pattern, generally ranging between approximately 2,600 million and 4,800 million US dollars. A notable trough occurred at the end of 2020 with cash assets at close to 2,610 million US dollars, before gradually increasing again by the third quarter of 2022 to nearly 4,910 million US dollars.
- Current Liabilities
- Current liabilities showed a steady rise in several periods. From the beginning of the observed timeline, the liabilities grew from about 3,152 million US dollars to a peak of approximately 5,018 million US dollars in mid-2022. Some quarters, particularly the fourth quarters of 2019 and 2021, recorded substantially higher liabilities compared to earlier periods. This upward trend indicates an increasing short-term obligation burden over the timeframe.
- Cash Ratio
- The cash ratio, representing the firm's liquidity by comparing cash assets to current liabilities, demonstrated considerable variability. Starting from a high of 1.88 in the first quarter of 2018, the ratio generally declined through 2018 and 2019, occasionally dipping below 1.00, indicating that cash reserves were sometimes lower than current liabilities in those quarters. During 2020 and 2021, the ratio mostly remained below 1.00, with a low of 0.7 observed twice, suggesting constrained liquidity in those periods. However, by mid to late 2022, the cash ratio improved, reaching up to 1.25 in the third quarter, reflecting stronger liquidity positions relative to current liabilities by the end of the period analyzed.
In summary, the data indicates a company experiencing considerable oscillations in cash assets alongside an increasing trend in current liabilities, leading to periods of constrained liquidity. The cash ratio's fluctuation below and above the critical threshold of 1.00 across quarters highlights variability in the company's ability to cover short-term obligations with cash alone. Recent quarters suggest an improvement in liquidity, which may be a result of either increased cash assets, improved management of liabilities, or a combination of both.