Analysis of Liquidity Ratios
Quarterly Data
Liquidity ratios measure the company ability to meet its short-term obligations.
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Liquidity Ratios (Summary)
Paramount Global, liquidity ratios (quarterly data)
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 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).
- Current Ratio
- The current ratio fluctuated over the observed periods, beginning at 1.5 and peaking around mid-2021 at approximately 1.78. Following this peak, a general declining trend can be observed, with the ratio decreasing steadily to 1.12 by the first quarter of 2023. This indicates a reduction in the company’s ability to cover short-term liabilities with current assets over the most recent quarters.
- Quick Ratio
- The quick ratio shows a similar pattern to the current ratio but with generally lower values, reflecting more stringent liquidity criteria. Starting near 1.03, it experienced a modest increase reaching its highest point at 1.47 in March 2021. After this peak, the quick ratio declined consistently, reaching 0.85 by March 2023. This downward movement suggests a weakening in the company's near-term liquid asset position relative to current liabilities.
- Cash Ratio
- The cash ratio began at a low base of 0.11 and demonstrated considerable variation over time. Notably, there was a marked increase beginning in mid-2020, peaking at 0.66 near the end of 2021. Subsequently, the cash ratio decreased steadily, falling to 0.19 by the first quarter of 2023. This trend indicates fluctuations in the company's most liquid assets (cash and cash equivalents) relative to its current liabilities, with recent quarters showing reduced cash coverage.
Current Ratio
Paramount Global, current ratio calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||
| Current assets | |||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||
| Liquidity Ratio | |||||||||||||||||||||||
| Current ratio1 | |||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||
| Current Ratio, Competitors2 | |||||||||||||||||||||||
| Alphabet Inc. | |||||||||||||||||||||||
| Comcast Corp. | |||||||||||||||||||||||
| Meta Platforms Inc. | |||||||||||||||||||||||
| Netflix Inc. | |||||||||||||||||||||||
| Trade Desk Inc. | |||||||||||||||||||||||
| Walt Disney Co. | |||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 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).
1 Q1 2023 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Current Assets
- The current assets exhibit notable fluctuations over the analyzed period. Beginning at a moderate level, there is a significant increase at the end of 2019, peaking around December 31, 2019. Following this peak, the values remain elevated through 2020 and early 2021, reaching the highest point in March 2021. Subsequently, a gradual decline is observed through 2022 and into the first quarter of 2023, indicating a reduction in liquidity or asset holdings in the short term.
- Current Liabilities
- Current liabilities show an initial decrease from early to mid-2019, followed by a sharp increase towards the end of 2019, mirroring the pattern seen in current assets. Post this rise, liabilities fluctuate mildly through 2020 and 2021 but begin to increase steadily in 2022, culminating in the highest recorded levels by the first quarter of 2023. This trend suggests growing short-term obligations that may impact working capital management.
- Current Ratio
- The current ratio, calculated as current assets divided by current liabilities, reflects the company's liquidity position over time. Initially, the ratio is relatively stable around 1.5 to 1.65, dipping to its lowest at the end of 2019. Thereafter, there is a recovery and improvement through 2020 and early 2021, with the ratio peaking close to 1.78. From mid-2021 onwards, the ratio exhibits a downward trend, steadily declining to approximately 1.12 by the first quarter of 2023. This indicates a reduced cushion to cover short-term liabilities with current assets, potentially signaling tightened liquidity or increased financial pressure.
- Overall Analysis
- Throughout the observed timeframe, the company experienced phases of increased current assets and liabilities, with a strong liquidity position around early 2021 as reflected by the current ratio. However, the latter part of the period shows a consistent decline in the current ratio due to growing current liabilities coupled with diminishing current assets. This suggests a potential need for management attention regarding working capital optimization and short-term financial stability to ensure the company maintains sufficient liquidity to meet its ongoing obligations.
Quick Ratio
Paramount Global, quick ratio calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||
| Cash and cash equivalents | |||||||||||||||||||||||
| Receivables, net | |||||||||||||||||||||||
| Total quick assets | |||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||
| Liquidity Ratio | |||||||||||||||||||||||
| Quick ratio1 | |||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||
| Quick Ratio, Competitors2 | |||||||||||||||||||||||
| Alphabet Inc. | |||||||||||||||||||||||
| Comcast Corp. | |||||||||||||||||||||||
| Meta Platforms Inc. | |||||||||||||||||||||||
| Netflix Inc. | |||||||||||||||||||||||
| Trade Desk Inc. | |||||||||||||||||||||||
| Walt Disney Co. | |||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 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).
1 Q1 2023 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Trend in Total Quick Assets
- Total quick assets exhibited fluctuations over the observed quarters. Initially, a decline was observed from the first quarter of 2019 through the third quarter of 2019, reaching a low point. A sharp increase occurred in the fourth quarter of 2019, which was largely maintained throughout 2020, peaking around the third quarter of 2020. The following period through 2021 saw a general upward trend, culminating in the highest levels recorded in the first quarter of 2021. In 2022, quick assets showed a downward trajectory, particularly pronounced in the second and third quarters, before stabilizing somewhat in late 2022 and early 2023 with a slight reduction by the first quarter of 2023.
- Trend in Current Liabilities
- Current liabilities followed a somewhat parallel pattern with fluctuations over the period. There was a steady increase from early 2019 into the end of 2019, peaking alongside quick assets in the final quarter of 2019. The following quarters through 2020 showed a smaller range of changes, mostly stabilizing but with a slight decline mid-year before increasing again toward the end of 2020. From 2021 into early 2023, current liabilities showed a consistent growth trend, with notable increases toward late 2022 and into the early months of 2023 reaching the highest recorded amounts in this dataset.
- Quick Ratio Analysis
- The quick ratio, reflecting liquidity, showed considerable variation across the quarters. From early to mid-2019, the ratio hovered around 1, signaling near balance between quick assets and current liabilities. It declined notably in late 2019 and early 2020, dropping below 1, indicating a weakening liquidity position. However, starting mid-2020, the quick ratio improved substantially, peaking around the first quarter of 2021 and maintaining above 1 through most of 2021, suggesting stronger short-term liquidity. Post-2021, the quick ratio trended downward sharply, falling below 1 by mid-2022 and continuing to decline into early 2023, reaching the lowest level recorded during the period, which may reflect a tightening liquidity and a potential increase in short-term financial pressure.
- Overall Observations
- The relationship between quick assets and current liabilities indicates fluctuating liquidity conditions. The increase in quick assets in late 2019 and 2020 improved the quick ratio significantly, denoting enhanced capacity to cover short-term obligations. Conversely, despite rising current liabilities in 2022 and 2023, quick assets decreased leading to a decline in the quick ratio. This shift points to potential liquidity risk concerns in the most recent quarters analyzed, warranting closer monitoring of cash equivalents and near-cash resources relative to immediate liabilities.
Cash Ratio
Paramount Global, cash ratio calculation (quarterly data)
| Mar 31, 2023 | Dec 31, 2022 | 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||
| Cash and cash equivalents | |||||||||||||||||||||||
| Total cash assets | |||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||
| Liquidity Ratio | |||||||||||||||||||||||
| Cash ratio1 | |||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||
| Cash Ratio, Competitors2 | |||||||||||||||||||||||
| Alphabet Inc. | |||||||||||||||||||||||
| Comcast Corp. | |||||||||||||||||||||||
| Meta Platforms Inc. | |||||||||||||||||||||||
| Netflix Inc. | |||||||||||||||||||||||
| Trade Desk Inc. | |||||||||||||||||||||||
| Walt Disney Co. | |||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 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).
1 Q1 2023 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Cash Assets
- The total cash assets exhibit considerable volatility over the observed quarters. Starting from moderate levels around 500 million US dollars in early 2019, there is a notable decline through mid to late 2019, reaching as low as 196 million US dollars in September 2019. A substantial increase occurs starting in the second quarter of 2020, peaking at over 3 billion US dollars by September 2020. This elevated cash level is maintained through 2021, with amounts fluctuating between approximately 4.8 billion to over 6 billion US dollars. However, from early 2022 onwards, there is a marked downward trend, with cash assets gradually decreasing each quarter to a level just above 2 billion US dollars by March 2023.
- Current Liabilities
- Current liabilities show an overall upward trajectory throughout the period. They start near 4.5 billion US dollars in early 2019, remaining relatively stable until the end of 2019. A sharp increase occurs by December 2019, more than doubling to over 9 billion US dollars, possibly driven by broader economic or business factors. Subsequently, liabilities maintain a range between approximately 7.7 billion and 9.7 billion US dollars during 2020 and 2021, showing periodic fluctuations but no definitive downward trend. Starting in 2022, liabilities continue to increase gradually, reaching nearly 11.3 billion US dollars by the first quarter of 2023.
- Cash Ratio
- The cash ratio, representing the capacity to cover current liabilities with cash assets, reflects the interplay between the two preceding metrics. Initially, the ratio is quite low, fluctuating between 0.05 and 0.11 in 2019, indicating limited liquidity coverage. A significant improvement emerges in mid-2020, rising sharply to around 0.29 and further increasing to peaks above 0.6 during 2021. This suggests a period where cash assets were relatively abundant compared to current liabilities. However, from 2022 onward, the cash ratio declines steadily, reaching approximately 0.19 by March 2023. This decline points to diminishing liquidity relative to current obligations, consistent with the observed reduction in cash assets amid rising liabilities.
- Summary of Financial Position Trends
- The overall financial position reveals increased pressure on liquidity in recent periods. While the company was able to amass and maintain high levels of cash assets relative to liabilities through 2020 and 2021—reflected by a strong cash ratio—there is a clear trend of eroding cash reserves coupled with growing short-term obligations starting in 2022. This shift results in a more constrained liquidity position as of early 2023, which may impact financial flexibility and risk management depending on broader operational and market contexts.