Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
Expedia Group Inc., liquidity ratios
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Current ratio | 0.87 | 1.04 | 0.72 | 0.64 | 0.70 | |
| Quick ratio | 0.77 | 0.90 | 0.67 | 0.61 | 0.67 | |
| Cash ratio | 0.64 | 0.77 | 0.43 | 0.34 | 0.43 |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Liquidity Ratios Analysis
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Over the five-year period, the company's liquidity position as measured by the current ratio exhibited a general improvement, particularly noticeable in the year ending December 31, 2020, when the ratio increased from 0.72 in 2019 to 1.04. This marks the only instance within the period where the current ratio exceeded 1, indicating the company had more current assets than current liabilities at that time. However, in 2021, the current ratio declined to 0.87, suggesting some reduction in short-term liquidity compared to the previous year but still remaining above the earlier years except 2020.
The quick ratio, which excludes inventory from current assets, followed a similar pattern. It rose from 0.67 in 2019 to 0.90 in 2020, indicating an improved ability to meet short-term obligations with the most liquid assets. A decrease to 0.77 in 2021 suggests a slight weakening in quick asset coverage but remains higher than in the years prior to 2020.
The cash ratio, representing the most conservative liquidity measure as it only considers cash and cash equivalents, also showed an upward trend culminating at 0.77 in 2020 from 0.43 in 2019. This improvement indicates enhanced cash reserves relative to current liabilities. The subsequent fall to 0.64 in 2021 still reflects stronger liquidity than the beginning of the analyzed period but shows a moderate decline from the peak year.
Overall, liquidity ratios demonstrate a significant strengthening in 2020, likely corresponding to an emphasis on maintaining higher liquidity during that period. The decline in 2021 across all liquidity ratios suggests a partial relaxation of liquidity positions, but ratios remain generally improved relative to the earlier years of the analyzed timeframe.
Current Ratio
Expedia Group Inc., current ratio calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | 8,181) | 5,634) | 7,735) | 5,197) | 5,540) | |
| Current liabilities | 9,450) | 5,406) | 10,714) | 8,060) | 7,879) | |
| Liquidity Ratio | ||||||
| Current ratio1 | 0.87 | 1.04 | 0.72 | 0.64 | 0.70 | |
| Benchmarks | ||||||
| Current Ratio, Competitors2 | ||||||
| Amazon.com Inc. | 1.14 | 1.05 | — | — | — | |
| Home Depot Inc. | 1.23 | 1.08 | — | — | — | |
| Lowe’s Cos. Inc. | 1.19 | 1.01 | — | — | — | |
| TJX Cos. Inc. | 1.46 | 1.24 | — | — | — | |
| Current Ratio, Sector | ||||||
| Consumer Discretionary Distribution & Retail | 1.17 | 1.06 | — | — | — | |
| Current Ratio, Industry | ||||||
| Consumer Discretionary | 1.25 | 1.19 | — | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Current ratio = Current assets ÷ Current liabilities
= 8,181 ÷ 9,450 = 0.87
2 Click competitor name to see calculations.
- Current Assets
- The current assets exhibit a fluctuating trend over the observed periods. Starting at 5,540 million US dollars at the end of 2017, they decreased slightly in 2018 to 5,197 million. There was a significant upward movement in 2019, reaching 7,735 million, followed by a decline in 2020 to 5,634 million. The figure rose again in 2021, reaching 8,181 million. This pattern indicates volatility with a general upward trend towards the end of the period.
- Current Liabilities
- Current liabilities show a generally increasing trend over the timeframe considered. The values rose from 7,879 million US dollars in 2017 to 8,060 million in 2018 and further escalated to 10,714 million in 2019. Notably, there was a sharp reduction in 2020 to 5,406 million, but liabilities increased again in 2021 to 9,450 million. The peak in 2019 followed by a considerable drop in 2020 and a rebound in 2021 may reflect seasonal or event-driven factors influencing obligations.
- Current Ratio
- The current ratio moved in alignment with the patterns in current assets and liabilities, exhibiting notable fluctuations. Beginning at 0.7 in 2017, it declined slightly to 0.64 in 2018, then rose to 0.72 in 2019, indicating some improvement in short-term liquidity. In 2020, the ratio increased substantially to 1.04, suggesting enhanced ability to cover short-term obligations during that year. However, in 2021, it decreased to 0.87, signifying a decline in liquidity though still above the levels seen in 2017-2019. Overall, the current ratio suggests variability in the company's short-term financial health, with the peak in 2020 likely influenced by reduced liabilities or increased assets.
Quick Ratio
Expedia Group Inc., quick ratio calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash and cash equivalents | 4,111) | 3,363) | 3,315) | 2,443) | 2,847) | |
| Restricted cash and cash equivalents | 1,694) | 772) | 779) | 259) | 69) | |
| Short-term investments | 200) | 24) | 526) | 28) | 469) | |
| Accounts receivable, net of allowance | 1,264) | 701) | 2,524) | 2,151) | 1,866) | |
| Total quick assets | 7,269) | 4,860) | 7,144) | 4,881) | 5,250) | |
| Current liabilities | 9,450) | 5,406) | 10,714) | 8,060) | 7,879) | |
| Liquidity Ratio | ||||||
| Quick ratio1 | 0.77 | 0.90 | 0.67 | 0.61 | 0.67 | |
| Benchmarks | ||||||
| Quick Ratio, Competitors2 | ||||||
| Amazon.com Inc. | 0.86 | 0.83 | — | — | — | |
| Home Depot Inc. | 0.47 | 0.23 | — | — | — | |
| Lowe’s Cos. Inc. | 0.28 | 0.06 | — | — | — | |
| TJX Cos. Inc. | 1.01 | 0.50 | — | — | — | |
| Quick Ratio, Sector | ||||||
| Consumer Discretionary Distribution & Retail | 0.77 | 0.68 | — | — | — | |
| Quick Ratio, Industry | ||||||
| Consumer Discretionary | 0.93 | 0.89 | — | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 7,269 ÷ 9,450 = 0.77
2 Click competitor name to see calculations.
The financial data reveals notable fluctuations in key liquidity indicators over the examined five-year period.
- Total quick assets
- The total quick assets experienced an overall increase from $5,250 million in 2017 to $7,269 million in 2021. There was a decline in 2018 to $4,881 million, followed by a sharp rise in 2019 to $7,144 million. Another decrease occurred in 2020 to $4,860 million, with a subsequent recovery to the highest value in 2021. This pattern suggests volatility in liquid asset levels, potentially reflecting changes in cash management, receivables, or marketable securities.
- Current liabilities
- Current liabilities showed a general upward trend from $7,879 million in 2017 to $9,450 million in 2021. Noteworthy is the decline in 2020 to $5,406 million, which then increased significantly in 2021. The peak in 2019 of $10,714 million represents the highest recorded liabilities in the period. This indicates fluctuations in short-term obligations, possibly linked to operational cycles or financing activities.
- Quick ratio
- The quick ratio demonstrates a varied pattern, starting at 0.67 in 2017, declining slightly to 0.61 in 2018, and returning to 0.67 in 2019. It improved markedly in 2020 to 0.9, before decreasing to 0.77 in 2021. The improvement in 2020 suggests an enhanced ability to cover current liabilities with liquid assets during that year, while the subsequent decrease indicates a moderate reduction in short-term liquidity relative to current liabilities.
In summary, both liquid assets and current liabilities have shown considerable variability, with total quick assets and current liabilities experiencing peaks and troughs across the years. Despite these fluctuations, the quick ratio remained below 1 throughout the period, indicating that quick assets were consistently insufficient to cover current liabilities in full. The highest liquidity ratio observed was 0.9 in 2020, signifying the strongest liquidity position during the period reviewed.
Cash Ratio
Expedia Group Inc., cash ratio calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash and cash equivalents | 4,111) | 3,363) | 3,315) | 2,443) | 2,847) | |
| Restricted cash and cash equivalents | 1,694) | 772) | 779) | 259) | 69) | |
| Short-term investments | 200) | 24) | 526) | 28) | 469) | |
| Total cash assets | 6,005) | 4,159) | 4,620) | 2,730) | 3,384) | |
| Current liabilities | 9,450) | 5,406) | 10,714) | 8,060) | 7,879) | |
| Liquidity Ratio | ||||||
| Cash ratio1 | 0.64 | 0.77 | 0.43 | 0.34 | 0.43 | |
| Benchmarks | ||||||
| Cash Ratio, Competitors2 | ||||||
| Amazon.com Inc. | 0.68 | 0.67 | — | — | — | |
| Home Depot Inc. | 0.34 | 0.12 | — | — | — | |
| Lowe’s Cos. Inc. | 0.28 | 0.06 | — | — | — | |
| TJX Cos. Inc. | 0.97 | 0.45 | — | — | — | |
| Cash Ratio, Sector | ||||||
| Consumer Discretionary Distribution & Retail | 0.61 | 0.54 | — | — | — | |
| Cash Ratio, Industry | ||||||
| Consumer Discretionary | 0.64 | 0.59 | — | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 6,005 ÷ 9,450 = 0.64
2 Click competitor name to see calculations.
- Total Cash Assets
- The total cash assets exhibit a fluctuating but overall increasing trend over the analyzed period. Starting at $3,384 million in 2017, there is a decline to $2,730 million in 2018, followed by a significant rise to $4,620 million in 2019. The figure slightly decreases in 2020 to $4,159 million but then reaches the highest point in 2021 at $6,005 million.
- Current Liabilities
- Current liabilities show considerable variation. Initially, there is a gradual increase from $7,879 million in 2017 to $8,060 million in 2018, and a sharper increase to $10,714 million in 2019. In 2020, liabilities drastically reduce to $5,406 million, followed by a rebound to $9,450 million in 2021. This pattern suggests management of liabilities fluctuated notably, possibly in response to external or operational conditions.
- Cash Ratio
- The cash ratio reflects the liquidity position in relation to current liabilities. The ratio starts at 0.43 in 2017, dips to 0.34 in 2018, and climbs back to 0.43 in 2019. There is a marked increase in 2020 to 0.77, the highest during the period, indicating improved liquidity and a stronger cash position relative to short-term obligations. In 2021, the cash ratio decreases to 0.64 but remains well above the earlier years, indicating a relatively healthy short-term liquidity status.