Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
Express Scripts Holding Co., liquidity ratios
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Current ratio | 0.67 | 0.75 | 0.70 | 0.62 | 0.64 | |
| Quick ratio | 0.52 | 0.62 | 0.58 | 0.46 | 0.45 | |
| Cash ratio | 0.13 | 0.19 | 0.19 | 0.11 | 0.15 |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
The liquidity profile between 2013 and 2017 is characterized by consistently low ratios, with all three metrics remaining below 1.0 throughout the period. This indicates a persistent operational structure where current liabilities exceed current assets, although a general trend of improvement was observable from 2014 through 2016 before a decline occurred in 2017.
- Current Ratio
- The current ratio fluctuated within a narrow range, starting at 0.64 in 2013 and reaching a peak of 0.75 in 2016. A subsequent decline to 0.67 was recorded by the end of 2017, suggesting a reduction in the overall coverage of short-term obligations by current assets.
- Quick Ratio
- The quick ratio mirrored the trajectory of the current ratio, rising steadily from 0.45 in 2013 to 0.62 in 2016. The drop to 0.52 in 2017 highlights a decrease in the availability of highly liquid assets to meet immediate liabilities.
- Cash Ratio
- The cash ratio exhibited the most significant volatility, decreasing to 0.11 in 2014 before climbing to a plateau of 0.19 in 2015 and 2016. By December 31, 2017, the ratio fell to 0.13, indicating a lower proportion of cash and cash equivalents relative to current liabilities.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
Without a user account, I tend to respond rather slowly.
How can I help you?
Current Ratio
Express Scripts Holding Co., current ratio calculation, comparison to benchmarks
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Current assets | 11,957,100) | 12,363,400) | 12,059,500) | 10,568,100) | 8,491,400) | |
| Current liabilities | 17,846,400) | 16,428,100) | 17,155,300) | 17,016,900) | 13,235,300) | |
| Liquidity Ratio | ||||||
| Current ratio1 | 0.67 | 0.75 | 0.70 | 0.62 | 0.64 | |
| Benchmarks | ||||||
| Current Ratio, Competitors2 | ||||||
| Abbott Laboratories | — | — | — | — | — | |
| Elevance Health Inc. | — | — | — | — | — | |
| Intuitive Surgical Inc. | — | — | — | — | — | |
| Medtronic PLC | — | — | — | — | — | |
| UnitedHealth Group Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
1 2017 Calculation
Current ratio = Current assets ÷ Current liabilities
= 11,957,100 ÷ 17,846,400 = 0.67
2 Click competitor name to see calculations.
An analysis of the liquidity position between December 31, 2013, and December 31, 2017, reveals a consistent trend where current liabilities exceed current assets. The current ratio remained below 1.0 throughout the entire five-year period, indicating a persistent deficit in short-term liquidity coverage.
- Current Assets Trend
- A general upward trajectory was observed from 2013 to 2016, with assets increasing from 8.49 billion US$ to a peak of 12.36 billion US$. This growth was followed by a slight contraction in 2017, where assets decreased to 11.96 billion US$.
- Current Liabilities Trend
- Current liabilities experienced a significant increase between 2013 and 2014, rising from 13.24 billion US$ to 17.02 billion US$. Following this sharp increase, liabilities remained relatively stable, fluctuating between 16.43 billion US$ and 17.85 billion US$ over the subsequent three years.
- Current Ratio Performance
- The current ratio exhibited moderate volatility, starting at 0.64 in 2013 and reaching its lowest point of 0.62 in 2014. A recovery phase followed, with the ratio improving to 0.70 in 2015 and peaking at 0.75 in 2016. However, this improvement was reversed in 2017, as the ratio declined to 0.67.
The data suggests that while there was a concerted improvement in the liquidity ratio between 2014 and 2016, the company consistently maintained a working capital deficit. The decline observed in 2017, characterized by simultaneous decreases in current assets and increases in current liabilities, resulted in a weakened liquidity position relative to the previous year.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
Without a user account, I tend to respond rather slowly.
How can I help you?
Quick Ratio
Express Scripts Holding Co., quick ratio calculation, comparison to benchmarks
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Cash and cash equivalents | 2,309,600) | 3,077,200) | 3,186,300) | 1,832,600) | 1,991,400) | |
| Receivables, net | 7,056,300) | 7,062,100) | 6,721,300) | 5,979,800) | 4,022,900) | |
| Total quick assets | 9,365,900) | 10,139,300) | 9,907,600) | 7,812,400) | 6,014,300) | |
| Current liabilities | 17,846,400) | 16,428,100) | 17,155,300) | 17,016,900) | 13,235,300) | |
| Liquidity Ratio | ||||||
| Quick ratio1 | 0.52 | 0.62 | 0.58 | 0.46 | 0.45 | |
| Benchmarks | ||||||
| Quick Ratio, Competitors2 | ||||||
| Abbott Laboratories | — | — | — | — | — | |
| Elevance Health Inc. | — | — | — | — | — | |
| Intuitive Surgical Inc. | — | — | — | — | — | |
| Medtronic PLC | — | — | — | — | — | |
| UnitedHealth Group Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
1 2017 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 9,365,900 ÷ 17,846,400 = 0.52
2 Click competitor name to see calculations.
The liquidity position from 2013 to 2017 exhibits a period of moderate improvement in short-term solvency that peaked in 2016 before experiencing a decline in 2017. Throughout the five-year period, the quick ratio consistently remained below 1.0, indicating that quick assets were insufficient to cover total current liabilities without relying on the sale of inventory or other less liquid current assets.
- Quick Assets Trend
- A steady upward trajectory in total quick assets was observed from 2013 to 2016, with values increasing from 6,014,300 thousand US$ to a peak of 10,139,300 thousand US$. However, this growth reversed in 2017, as quick assets decreased to 9,365,900 thousand US$, representing a contraction in the most liquid asset base.
- Current Liabilities Trend
- Current liabilities saw a significant increase between 2013 and 2014, rising from 13,235,300 thousand US$ to 17,016,900 thousand US$. For the remainder of the period, liabilities remained relatively stable, fluctuating between 16,428,100 thousand US$ in 2016 and a five-year high of 17,846,400 thousand US$ in 2017.
- Quick Ratio Analysis
- The quick ratio demonstrated a progressive improvement from 0.45 in 2013 to 0.62 in 2016. This positive trend was driven by the growth of quick assets outpacing the growth of current liabilities during that interval. In 2017, the ratio fell to 0.52, a result of the simultaneous decrease in quick assets and an increase in current liabilities, which weakened the overall immediate liquidity profile.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
Without a user account, I tend to respond rather slowly.
How can I help you?
Cash Ratio
Express Scripts Holding Co., cash ratio calculation, comparison to benchmarks
| Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Cash and cash equivalents | 2,309,600) | 3,077,200) | 3,186,300) | 1,832,600) | 1,991,400) | |
| Total cash assets | 2,309,600) | 3,077,200) | 3,186,300) | 1,832,600) | 1,991,400) | |
| Current liabilities | 17,846,400) | 16,428,100) | 17,155,300) | 17,016,900) | 13,235,300) | |
| Liquidity Ratio | ||||||
| Cash ratio1 | 0.13 | 0.19 | 0.19 | 0.11 | 0.15 | |
| Benchmarks | ||||||
| Cash Ratio, Competitors2 | ||||||
| Abbott Laboratories | — | — | — | — | — | |
| Elevance Health Inc. | — | — | — | — | — | |
| Intuitive Surgical Inc. | — | — | — | — | — | |
| Medtronic PLC | — | — | — | — | — | |
| UnitedHealth Group Inc. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31).
1 2017 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 2,309,600 ÷ 17,846,400 = 0.13
2 Click competitor name to see calculations.
The company's liquidity position, specifically its ability to cover short-term obligations using only cash and cash equivalents, demonstrated volatility between 2013 and 2017. The cash ratio remained consistently low, peaking at 0.19 in 2015 and 2016 before declining to 0.13 by the end of 2017. This trend indicates a limited reliance on immediate cash reserves to meet current liabilities, suggesting that the company likely depends on other current assets or continuous operational cash flow to manage its short-term obligations.
- Cash Asset Fluctuations
- Total cash assets exhibited a non-linear trend, with an initial decrease in 2014 followed by a significant increase to a peak of 3,186,300 thousand US dollars in 2015. Following this peak, cash holdings entered a period of decline, ending at 2,309,600 thousand US dollars by December 31, 2017.
- Current Liabilities Trajectory
- A substantial increase in current liabilities occurred between 2013 and 2014, where obligations rose from 13,235,300 thousand US dollars to 17,016,900 thousand US dollars. For the remainder of the period, liabilities remained elevated and relatively stable, concluding at 17,846,400 thousand US dollars in 2017.
- Cash Ratio Dynamics
- The cash ratio reached its lowest point of 0.11 in 2014, driven by the simultaneous increase in liabilities and decrease in cash. A recovery to 0.19 was observed in 2015 and 2016, corresponding with the period of highest cash accumulation. The ratio subsequently contracted to 0.13 in 2017, resulting from a reduction in cash assets alongside a rise in total current liabilities.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
Without a user account, I tend to respond rather slowly.
How can I help you?