Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
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Liquidity Ratios (Summary)
Fiserv Inc., liquidity ratios
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Current ratio | ||||||
| Quick ratio | ||||||
| Cash ratio |
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).
- Current ratio
- The current ratio exhibited minor fluctuations over the analyzed period, starting at 1.02 in 2017 and rising to a peak of 1.11 in 2018. Subsequently, it declined to 1.08 in 2019 and further tapered off to 1.04 and 1.03 in 2020 and 2021, respectively. This suggests a slight weakening in short-term liquidity but overall sustained ability to cover current liabilities with current assets.
- Quick ratio
- The quick ratio demonstrated a generally positive trend from 2017 through 2019, improving from 0.88 to 0.99, indicating enhanced liquidity excluding inventory. However, this improvement was somewhat reversed in 2020 and stabilized at 0.95 in both 2020 and 2021. This indicates that, while there was a recovery phase, the company maintained a reasonably strong liquid asset base relative to its current liabilities.
- Cash ratio
- The cash ratio remained consistently low throughout the period, beginning at 0.17 in 2017 and increasing slightly to 0.21 in 2018. Following this, there was a noticeable decline to 0.06 in 2019, maintaining that level in 2020 and slightly decreasing again to 0.05 in 2021. This points to a reduced reliance on cash and cash equivalents for covering short-term obligations, suggesting potential reliance on other liquid current assets or credit facilities.
Current Ratio
Fiserv 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 | ||||||
| Current liabilities | ||||||
| Liquidity Ratio | ||||||
| Current ratio1 | ||||||
| Benchmarks | ||||||
| Current Ratio, Competitors2 | ||||||
| Accenture PLC | ||||||
| Adobe Inc. | ||||||
| Cadence Design Systems Inc. | ||||||
| CrowdStrike Holdings Inc. | ||||||
| Fair Isaac Corp. | ||||||
| International Business Machines Corp. | ||||||
| Intuit Inc. | ||||||
| Microsoft Corp. | ||||||
| Oracle Corp. | ||||||
| Palantir Technologies Inc. | ||||||
| Palo Alto Networks Inc. | ||||||
| Salesforce Inc. | ||||||
| ServiceNow Inc. | ||||||
| Synopsys Inc. | ||||||
| Workday Inc. | ||||||
| Current Ratio, Sector | ||||||
| Software & Services | ||||||
| Current Ratio, Industry | ||||||
| Information Technology | ||||||
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
= ÷ =
2 Click competitor name to see calculations.
- Current Assets
- Current assets demonstrated a notable increase from 2017 to 2019, rising significantly from $1,975 million to $17,046 million. However, in the subsequent years, there was a slight decline observed in 2020 to $16,219 million, followed by a recovery to $18,870 million in 2021. Overall, the trend shows substantial growth with some year-to-year fluctuations towards the end of the period.
- Current Liabilities
- Current liabilities followed a similar pattern to current assets. Starting at $1,938 million in 2017, liabilities rose sharply to $15,727 million in 2019. The values then slightly decreased in 2020 to $15,637 million before increasing again to $18,295 million in 2021. This indicates a significant expansion in short-term obligations over the observed period, with minor volatility in the later years.
- Current Ratio
- The current ratio remained relatively stable throughout the period, starting at 1.02 in 2017 and showing a modest increase to 1.11 in 2018. From 2019 onward, the ratio declined slightly, ranging between 1.03 and 1.08, but staying above 1.00 each year. This suggests that despite the large increases in both current assets and current liabilities, the company consistently maintained a liquidity position where current assets slightly exceeded current liabilities.
- Overall Analysis
- The data reflects significant growth in both current assets and current liabilities from 2017 to 2021, indicating a scale-up in operational scope or increased short-term financing activity. Although the absolute values for assets and liabilities increased dramatically, the current ratio remained stable near 1.0, implying consistent management of liquidity and working capital. The slight decrease in the current ratio in recent years may warrant monitoring to ensure short-term financial obligations continue to be adequately covered by current assets.
Quick Ratio
Fiserv Inc., quick ratio calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash and cash equivalents | ||||||
| Trade accounts receivable, less allowance for doubtful accounts | ||||||
| Settlement assets | ||||||
| Total quick assets | ||||||
| Current liabilities | ||||||
| Liquidity Ratio | ||||||
| Quick ratio1 | ||||||
| Benchmarks | ||||||
| Quick Ratio, Competitors2 | ||||||
| Accenture PLC | ||||||
| Adobe Inc. | ||||||
| Cadence Design Systems Inc. | ||||||
| CrowdStrike Holdings Inc. | ||||||
| Fair Isaac Corp. | ||||||
| International Business Machines Corp. | ||||||
| Intuit Inc. | ||||||
| Microsoft Corp. | ||||||
| Oracle Corp. | ||||||
| Palantir Technologies Inc. | ||||||
| Palo Alto Networks Inc. | ||||||
| Salesforce Inc. | ||||||
| ServiceNow Inc. | ||||||
| Synopsys Inc. | ||||||
| Workday Inc. | ||||||
| Quick Ratio, Sector | ||||||
| Software & Services | ||||||
| Quick Ratio, Industry | ||||||
| Information Technology | ||||||
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
= ÷ =
2 Click competitor name to see calculations.
- Total quick assets
- The total quick assets experienced significant growth over the analyzed period. Starting at 1,707 million US dollars in 2017, values remained relatively stable until 2018 and then surged dramatically to reach 15,543 million in 2019. After a slight decline in 2020 to 14,909 million, there was a rebound to 17,347 million by the end of 2021. This reflects a considerable strengthening of liquid assets available.
- Current liabilities
- Current liabilities followed a similar upward trend, beginning at 1,938 million US dollars in 2017 and incrementally increasing to 2,010 million in 2018. A sharp escalation occurred in 2019 and 2020, reaching 15,727 million and 15,637 million respectively, followed by a further increase to 18,295 million in 2021. This indicates a significant rise in short-term obligations over the timeframe.
- Quick ratio
- The quick ratio displayed slight fluctuations but overall remained close to parity throughout the years. Starting at 0.88 in 2017, it improved to 0.97 in 2018 and 0.99 in 2019, suggesting increased coverage of current liabilities by liquid assets. The ratio then dipped modestly to 0.95 in 2020 and stayed constant at 0.95 in 2021. This consistency near the threshold of 1 indicates a stable but slightly cautious liquidity position.
Cash Ratio
Fiserv 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 | ||||||
| Total cash assets | ||||||
| Current liabilities | ||||||
| Liquidity Ratio | ||||||
| Cash ratio1 | ||||||
| Benchmarks | ||||||
| Cash Ratio, Competitors2 | ||||||
| Accenture PLC | ||||||
| Adobe Inc. | ||||||
| Cadence Design Systems Inc. | ||||||
| CrowdStrike Holdings Inc. | ||||||
| Fair Isaac Corp. | ||||||
| International Business Machines Corp. | ||||||
| Intuit Inc. | ||||||
| Microsoft Corp. | ||||||
| Oracle Corp. | ||||||
| Palantir Technologies Inc. | ||||||
| Palo Alto Networks Inc. | ||||||
| Salesforce Inc. | ||||||
| ServiceNow Inc. | ||||||
| Synopsys Inc. | ||||||
| Workday Inc. | ||||||
| Cash Ratio, Sector | ||||||
| Software & Services | ||||||
| Cash Ratio, Industry | ||||||
| Information Technology | ||||||
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
= ÷ =
2 Click competitor name to see calculations.
- Total cash assets
- The total cash assets showed a marked increase from 2017 to 2019, rising from 325 million US dollars to 893 million US dollars. However, this upward trend stabilized in 2020 and slightly declined in 2021, with the values registering at 906 million and 835 million US dollars, respectively. This indicates an initial strong growth in liquidity assets, which then plateaued and saw a marginal decrease towards the end of the period.
- Current liabilities
- Current liabilities remained relatively stable between 2017 and 2018, increasing slightly from 1,938 million to 2,010 million US dollars. A substantial increase is observed in 2019, with current liabilities rising dramatically to 15,727 million US dollars, and this elevated level persisted through 2020 and 2021 at 15,637 million and 18,295 million US dollars, respectively. This sharp increase suggests a significant change in the company's short-term obligations starting in 2019, indicating potentially increased operational scale or financial leverage.
- Cash ratio
- The cash ratio exhibited a downward trend over the period. It improved slightly from 0.17 in 2017 to 0.21 in 2018, reflecting a relatively stronger liquidity position early on. Subsequently, there was a sharp decline to 0.06 in 2019, which remained constant in 2020 and slightly decreased to 0.05 in 2021. This pattern corresponds with the substantial increase in current liabilities and relatively stable cash assets from 2019 onward, indicating diminishing liquid asset coverage over short-term liabilities.