Analysis of Liquidity Ratios

Liquidity ratios measure the company ability to meet its short-term obligations.

Palo Alto Networks Inc., liquidity ratios

	Jul 31, 2023	Jul 31, 2022	Jul 31, 2021	Jul 31, 2020	Jul 31, 2019	Jul 31, 2018
Current ratio	0.78	0.77	0.91	1.91	1.78	1.93
Quick ratio	0.72	0.75	0.88	1.85	1.72	1.81
Cash ratio	0.31	0.44	0.57	1.39	1.37	1.59

Download chart

Liquidity ratio	Description	The company
Current ratio	A liquidity ratio calculated as current assets divided by current liabilities.	Palo Alto Networks Inc. current ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.
Quick ratio	A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities.	Palo Alto Networks Inc. quick ratio deteriorated from 2021 to 2022 and from 2022 to 2023.
Cash ratio	A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities.	Palo Alto Networks Inc. cash ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Palo Alto Networks Inc., current ratio calculation, comparison to benchmarks

	Jul 31, 2023	Jul 31, 2022	Jul 31, 2021	Jul 31, 2020	Jul 31, 2019	Jul 31, 2018
Selected Financial Data (US$ in thousands)
Current assets	6,048,000)	6,414,900)	4,647,300)	5,129,200)	3,664,800)	4,132,000)
Current liabilities	7,737,500)	8,306,300)	5,116,700)	2,691,700)	2,053,300)	2,139,400)
Liquidity Ratio
Current ratio¹	0.78	0.77	0.91	1.91	1.78	1.93
Benchmarks
Current Ratio, Competitors²
Accenture PLC	1.30	1.23	1.25	1.40	1.40	1.34
Adobe Inc.	1.34	1.11	1.25	1.48	0.79	1.13
International Business Machines Corp.	0.96	0.92	0.88	0.98	1.02	—
Intuit Inc.	1.47	1.39	1.94	2.26	1.83	1.14
Microsoft Corp.	1.77	1.78	2.08	2.52	2.53	2.90
Oracle Corp.	0.91	1.62	2.30	3.03	2.49	3.96
Salesforce Inc.	1.02	1.05	1.23	1.08	0.95	—
ServiceNow Inc.	1.06	1.11	1.05	1.21	1.03	—
Synopsys Inc.	1.15	1.09	1.16	1.19	0.99	0.73
Current Ratio, Sector
Software & Services	1.37	1.42	1.67	1.92	1.85	—
Current Ratio, Industry
Information Technology	1.46	1.44	1.64	1.85	1.77	—

¹ 2023 Calculation
Current ratio = Current assets ÷ Current liabilities
= 6,048,000 ÷ 7,737,500 = 0.78

² Click competitor name to see calculations.

Download chart

Liquidity ratio	Description	The company
Current ratio	A liquidity ratio calculated as current assets divided by current liabilities.	Palo Alto Networks Inc. current ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.

Palo Alto Networks Inc., quick ratio calculation, comparison to benchmarks

	Jul 31, 2023	Jul 31, 2022	Jul 31, 2021	Jul 31, 2020	Jul 31, 2019	Jul 31, 2018
Selected Financial Data (US$ in thousands)
Cash and cash equivalents	1,135,300)	2,118,500)	1,874,200)	2,958,000)	961,400)	2,506,900)
Short-term investments	1,254,700)	1,516,000)	1,026,900)	789,800)	1,841,700)	896,500)
Accounts receivable, net of allowance for credit losses	2,463,200)	2,142,500)	1,240,400)	1,037,100)	582,400)	467,300)
Short-term financing receivables, net	388,800)	111,300)	79,000)	—)	—)	—)
Short-term deferred contract costs	339,200)	317,700)	276,500)	206,000)	151,100)	—)
Total quick assets	5,581,200)	6,206,000)	4,497,000)	4,990,900)	3,536,600)	3,870,700)

Current liabilities	7,737,500)	8,306,300)	5,116,700)	2,691,700)	2,053,300)	2,139,400)
Liquidity Ratio
Quick ratio¹	0.72	0.75	0.88	1.85	1.72	1.81
Benchmarks
Quick Ratio, Competitors²
Accenture PLC	1.18	1.12	1.14	1.29	1.29	1.24
Adobe Inc.	1.22	1.00	1.11	1.34	0.70	1.06
International Business Machines Corp.	0.80	0.73	0.67	0.83	0.87	—
Intuit Inc.	1.25	1.17	1.65	2.04	1.44	0.86
Microsoft Corp.	1.54	1.57	1.90	2.33	2.35	2.74
Oracle Corp.	0.74	1.43	2.15	2.83	2.31	3.78
Salesforce Inc.	0.90	0.93	1.11	0.95	0.82	—
ServiceNow Inc.	1.00	1.06	1.01	1.16	0.98	—
Synopsys Inc.	0.85	0.85	0.89	0.94	0.73	0.61
Quick Ratio, Sector
Software & Services	1.19	1.25	1.51	1.76	1.69	—
Quick Ratio, Industry
Information Technology	1.17	1.15	1.38	1.60	1.55	—

¹ 2023 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 5,581,200 ÷ 7,737,500 = 0.72

² Click competitor name to see calculations.

Download chart

Liquidity ratio	Description	The company
Quick ratio	A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities.	Palo Alto Networks Inc. quick ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Palo Alto Networks Inc., cash ratio calculation, comparison to benchmarks

	Jul 31, 2023	Jul 31, 2022	Jul 31, 2021	Jul 31, 2020	Jul 31, 2019	Jul 31, 2018
Selected Financial Data (US$ in thousands)
Cash and cash equivalents	1,135,300)	2,118,500)	1,874,200)	2,958,000)	961,400)	2,506,900)
Short-term investments	1,254,700)	1,516,000)	1,026,900)	789,800)	1,841,700)	896,500)
Total cash assets	2,390,000)	3,634,500)	2,901,100)	3,747,800)	2,803,100)	3,403,400)

Current liabilities	7,737,500)	8,306,300)	5,116,700)	2,691,700)	2,053,300)	2,139,400)
Liquidity Ratio
Cash ratio¹	0.31	0.44	0.57	1.39	1.37	1.59
Benchmarks
Cash Ratio, Competitors²
Accenture PLC	0.50	0.45	0.52	0.67	0.55	0.50
Adobe Inc.	0.95	0.75	0.84	1.09	0.51	0.75
International Business Machines Corp.	0.39	0.28	0.22	0.36	0.24	—
Intuit Inc.	0.97	0.90	1.46	2.00	1.39	0.81
Microsoft Corp.	1.07	1.10	1.47	1.89	1.93	2.29
Oracle Corp.	0.44	1.12	1.93	2.50	2.03	3.50
Salesforce Inc.	0.48	0.48	0.67	0.54	0.39	—
ServiceNow Inc.	0.66	0.71	0.67	0.83	0.61	—
Synopsys Inc.	0.53	0.56	0.65	0.58	0.42	0.34
Cash Ratio, Sector
Software & Services	0.75	0.81	1.10	1.33	1.23	—
Cash Ratio, Industry
Information Technology	0.75	0.72	0.96	1.19	1.11	—

¹ 2023 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 2,390,000 ÷ 7,737,500 = 0.31

² Click competitor name to see calculations.

Download chart

Liquidity ratio	Description	The company
Cash ratio	A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities.	Palo Alto Networks Inc. cash ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Palo Alto Networks Inc. (NASDAQ:PANW)