Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
Dollar General Corp., liquidity ratios
Based on: 10-K (reporting date: 2024-02-02), 10-K (reporting date: 2023-02-03), 10-K (reporting date: 2022-01-28), 10-K (reporting date: 2021-01-29), 10-K (reporting date: 2020-01-31), 10-K (reporting date: 2019-02-01).
- Current Ratio
- The current ratio exhibited a general decline from 1.55 in early 2019 to 1.05 by early 2022, indicating a decreasing level of current assets relative to current liabilities during this period. However, a partial recovery is observed in subsequent years, with the ratio increasing to 1.29 in early 2023 before slightly declining to 1.19 in early 2024. This suggests some improvement in short-term liquidity after reaching the lowest point, albeit not regaining the initial higher level.
- Quick Ratio
- The quick ratio remained consistently low throughout the entire period, starting from 0.08 in early 2019 and decreasing to 0.05 in early 2020. A notable rise occurred in early 2021, reaching 0.24, followed by a sharp drop back to around 0.06 in early 2022 and early 2023. By early 2024, a slight increase returned the quick ratio to 0.08, matching the value at the beginning of the observed timeline. This fluctuation suggests variations in the most liquid assets excluding inventory, though overall the quick ratio remains relatively weak.
- Cash Ratio
- The cash ratio closely mirrors the quick ratio trends across the years. Starting at 0.08 in early 2019, it falls to 0.05 in early 2020, peaks at 0.24 in early 2021, then declines to 0.06 in early 2022 and early 2023, before returning to 0.08 in early 2024. This pattern indicates similar changes in the company’s immediate cash availability relative to current liabilities, with only modest liquidity in cash and cash equivalents throughout the timeframe.
Current Ratio
Dollar General Corp., current ratio calculation, comparison to benchmarks
| Feb 2, 2024 | Feb 3, 2023 | Jan 28, 2022 | Jan 29, 2021 | Jan 31, 2020 | Feb 1, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Current assets | 8,010,724) | 7,581,009) | 6,303,843) | 6,914,219) | 5,177,868) | 4,663,020) | |
| Current liabilities | 6,725,701) | 5,887,768) | 5,979,357) | 5,710,783) | 4,543,560) | 3,015,857) | |
| Liquidity Ratio | |||||||
| Current ratio1 | 1.19 | 1.29 | 1.05 | 1.21 | 1.14 | 1.55 | |
| Benchmarks | |||||||
| Current Ratio, Competitors2 | |||||||
| Costco Wholesale Corp. | 0.97 | 1.07 | 1.02 | 1.00 | 1.13 | 1.01 | |
| Target Corp. | 0.91 | 0.92 | 0.99 | 1.03 | 0.89 | — | |
| Walmart Inc. | 0.83 | 0.82 | 0.93 | 0.97 | 0.79 | — | |
| Current Ratio, Sector | |||||||
| Consumer Staples Distribution & Retail | 0.87 | 0.89 | 0.96 | 0.99 | 0.88 | — | |
| Current Ratio, Industry | |||||||
| Consumer Staples | 0.85 | 0.84 | 0.87 | 0.93 | 0.92 | — | |
Based on: 10-K (reporting date: 2024-02-02), 10-K (reporting date: 2023-02-03), 10-K (reporting date: 2022-01-28), 10-K (reporting date: 2021-01-29), 10-K (reporting date: 2020-01-31), 10-K (reporting date: 2019-02-01).
1 2024 Calculation
Current ratio = Current assets ÷ Current liabilities
= 8,010,724 ÷ 6,725,701 = 1.19
2 Click competitor name to see calculations.
The financial data reveals notable variations in both current assets and current liabilities over the six-year period.
- Current Assets
-
Current assets exhibited an overall upward trend, increasing from approximately 4,663,020 thousand USD in 2019 to 8,010,724 thousand USD in 2024. An initial rise occurred between 2019 (4,663,020) and 2021 (6,914,219), followed by a slight decline in 2022 (6,303,843). This was succeeded by strong growth in 2023 (7,581,009) and 2024 (8,010,724), indicating enhanced liquidity and resource availability.
- Current Liabilities
-
Current liabilities consistently increased each year, starting from 3,015,857 thousand USD in 2019 and reaching 6,725,701 thousand USD in 2024. The rise was steady, with no periods of decline, suggesting growing short-term obligations that might be associated with operational expansion or increased financing needs.
- Current Ratio
-
The current ratio showed fluctuations, reflecting changes in the asset-to-liability balance. It decreased from 1.55 in 2019 to a low of 1.05 in 2022, indicating a tightening liquidity position during this period. However, it improved to 1.29 in 2023 before slightly declining to 1.19 in 2024. Although remaining above 1, the ratio implies modest liquidity margins with some volatility, necessitating monitoring to maintain adequate short-term financial health.
Quick Ratio
Dollar General Corp., quick ratio calculation, comparison to benchmarks
| Feb 2, 2024 | Feb 3, 2023 | Jan 28, 2022 | Jan 29, 2021 | Jan 31, 2020 | Feb 1, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Cash and cash equivalents | 537,283) | 381,576) | 344,829) | 1,376,577) | 240,320) | 235,487) | |
| Accounts receivable | —) | —) | —) | —) | —) | —) | |
| Total quick assets | 537,283) | 381,576) | 344,829) | 1,376,577) | 240,320) | 235,487) | |
| Current liabilities | 6,725,701) | 5,887,768) | 5,979,357) | 5,710,783) | 4,543,560) | 3,015,857) | |
| Liquidity Ratio | |||||||
| Quick ratio1 | 0.08 | 0.06 | 0.06 | 0.24 | 0.05 | 0.08 | |
| Benchmarks | |||||||
| Quick Ratio, Competitors2 | |||||||
| Costco Wholesale Corp. | 0.39 | 0.52 | 0.42 | 0.47 | 0.60 | 0.47 | |
| Target Corp. | 0.27 | 0.20 | 0.33 | 0.48 | 0.24 | — | |
| Walmart Inc. | 0.20 | 0.18 | 0.26 | 0.26 | 0.20 | — | |
| Quick Ratio, Sector | |||||||
| Consumer Staples Distribution & Retail | 0.26 | 0.26 | 0.31 | 0.34 | 0.29 | — | |
| Quick Ratio, Industry | |||||||
| Consumer Staples | 0.38 | 0.37 | 0.38 | 0.43 | 0.47 | — | |
Based on: 10-K (reporting date: 2024-02-02), 10-K (reporting date: 2023-02-03), 10-K (reporting date: 2022-01-28), 10-K (reporting date: 2021-01-29), 10-K (reporting date: 2020-01-31), 10-K (reporting date: 2019-02-01).
1 2024 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 537,283 ÷ 6,725,701 = 0.08
2 Click competitor name to see calculations.
- Total Quick Assets
- The total quick assets exhibit considerable fluctuation across the periods. Beginning at approximately $235 million in early 2019, the value slightly increased to around $240 million by early 2020. A significant spike occurred in early 2021, reaching nearly $1.38 billion. However, this increase was not sustained, as the figures subsequently declined to approximately $345 million in early 2022. From this point forward, total quick assets showed a steady upward trend, rising to about $382 million in early 2023 and further to $537 million by early 2024, indicating a recovery and strengthening of highly liquid assets.
- Current Liabilities
- Current liabilities have generally trended upward over the six-year period. Starting near $3.02 billion in early 2019, there was a noticeable increase to approximately $4.54 billion in early 2020. This upward momentum continued with a further rise to $5.71 billion at the beginning of 2021. From 2021 to 2022, the growth rate slowed but still increased to roughly $6.0 billion. A marginal decline was observed in 2023 with current liabilities decreasing to around $5.89 billion before increasing again to about $6.73 billion in early 2024. Overall, the data indicate expanding short-term obligations.
- Quick Ratio
- The quick ratio demonstrates consistently low values, indicating limited immediate liquidity relative to current liabilities. It started at 0.08 in early 2019, decreased to 0.05 in early 2020, and then jumped significantly to 0.24 in early 2021, reflecting the temporary surge in quick assets relative to liabilities. However, this improvement was short-lived as the ratio dropped back to 0.06 in early 2022 and maintained a similar level in early 2023. By early 2024, the quick ratio slightly improved to 0.08, matching the 2019 level. The overall pattern reveals persistent liquidity constraints, with the company having quick assets covering only a small fraction of current liabilities except for the anomalous increase in 2021.
Cash Ratio
Dollar General Corp., cash ratio calculation, comparison to benchmarks
| Feb 2, 2024 | Feb 3, 2023 | Jan 28, 2022 | Jan 29, 2021 | Jan 31, 2020 | Feb 1, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Cash and cash equivalents | 537,283) | 381,576) | 344,829) | 1,376,577) | 240,320) | 235,487) | |
| Total cash assets | 537,283) | 381,576) | 344,829) | 1,376,577) | 240,320) | 235,487) | |
| Current liabilities | 6,725,701) | 5,887,768) | 5,979,357) | 5,710,783) | 4,543,560) | 3,015,857) | |
| Liquidity Ratio | |||||||
| Cash ratio1 | 0.08 | 0.06 | 0.06 | 0.24 | 0.05 | 0.08 | |
| Benchmarks | |||||||
| Cash Ratio, Competitors2 | |||||||
| Costco Wholesale Corp. | 0.31 | 0.45 | 0.35 | 0.41 | 0.54 | 0.41 | |
| Target Corp. | 0.20 | 0.11 | 0.27 | 0.42 | 0.18 | — | |
| Walmart Inc. | 0.11 | 0.09 | 0.17 | 0.19 | 0.12 | — | |
| Cash Ratio, Sector | |||||||
| Consumer Staples Distribution & Retail | 0.17 | 0.18 | 0.22 | 0.27 | 0.22 | — | |
| Cash Ratio, Industry | |||||||
| Consumer Staples | 0.23 | 0.22 | 0.23 | 0.30 | 0.33 | — | |
Based on: 10-K (reporting date: 2024-02-02), 10-K (reporting date: 2023-02-03), 10-K (reporting date: 2022-01-28), 10-K (reporting date: 2021-01-29), 10-K (reporting date: 2020-01-31), 10-K (reporting date: 2019-02-01).
1 2024 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 537,283 ÷ 6,725,701 = 0.08
2 Click competitor name to see calculations.
- Total Cash Assets
- The total cash assets exhibited a highly variable trend over the analyzed periods. Beginning with a moderate amount in early 2019, there was a significant surge by early 2021, reaching well above one million US dollars. This spike was followed by a considerable decline in 2022. Subsequently, the figures showed a steady increase through 2023 and 2024, ending at over half a million US dollars, indicating a recovery trend after the prior decrease.
- Current Liabilities
- Current liabilities displayed a consistent upward trajectory throughout the periods under review. Starting at approximately three million US dollars in 2019, liabilities rose sharply to over four and a half million in 2020 and continued to escalate through 2021. The upward trend persisted, albeit at a slower pace, through 2022 and 2023, culminating at over six and a half million by early 2024. This persistent increase suggests growing short-term financial obligations over time.
- Cash Ratio
- The cash ratio, which measures the company’s ability to cover current liabilities with cash and cash equivalents, was relatively low across all years, generally below 0.10. Notably, a pronounced increase occurred in 2021, rising to 0.24, indicating enhanced liquidity during that year. However, the ratio subsequently declined sharply in 2022 and stabilized around 0.06 to 0.08 for the remaining years. Despite fluctuations, the overall liquidity position remained limited when compared to current liabilities.