Analysis of Liquidity Ratios
Quarterly Data
Liquidity ratios measure the company ability to meet its short-term obligations.
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- Balance Sheet: Assets
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Analysis of Reportable Segments
- Analysis of Geographic Areas
- Enterprise Value (EV)
- Selected Financial Data since 2013
- Net Profit Margin since 2013
- Analysis of Revenues
- Analysis of Debt
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Liquidity Ratios (Summary)
IQVIA Holdings Inc., liquidity ratios (quarterly data)
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 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 has exhibited a gradual decline over the observed periods. Starting from a relatively stable level around 1.14 in early 2019, there was a slight decrease towards the end of that year, reaching approximately 1.05. The ratio showed some resilience during 2020, maintaining values near 1.09 to 1.12. However, from 2021 onwards, a downward trend became evident, with the ratio dipping below 1.0 by mid-2021 and continuing to decrease to around 0.79 by the third quarter of 2023. This suggests a weakening in the company's short-term liquidity position, indicating that current liabilities increasingly exceeded current assets.
- Quick Ratio
- The quick ratio mirrored the trend observed in the current ratio but at slightly lower values, reflecting the exclusion of inventory from current assets. Initially close to 0.99 in the first quarter of 2019, the ratio declined moderately throughout 2019, falling below 0.9 by the end of the year. Despite some minor fluctuations during 2020, the ratio continued decreasing from 2021 onwards, reaching approximately 0.69 in the third quarter of 2023. The persistent decrease below 1.0 indicates reduced immediate liquidity and a growing challenge in covering short-term obligations without relying on inventory liquidation.
- Cash Ratio
- The cash ratio showed a different pattern compared to the other liquidity ratios. Initially, it remained relatively low, around 0.28 in early 2019, then gradually increased throughout 2020, peaking at around 0.49 by March 2021. This peak suggests an accumulation of cash or cash equivalents during that period, possibly reflecting conservative cash management or operational cash inflows. However, after the peak in early 2021, a steady decline followed, with the ratio reverting to lower levels near 0.2 by the third quarter of 2023. This decline might indicate a reduction in cash reserves relative to current liabilities, signaling a potential lowering in the company's immediate liquidity buffer.
- Overall Analysis
- Collectively, the liquidity ratios demonstrate a general weakening of the company's short-term financial health over the examined period. The decreasing trends in the current and quick ratios below 1.0 in recent quarters suggest increasing pressure to meet short-term liabilities, which may warrant attention from management. Despite a temporary improvement in cash holdings during 2020 and early 2021, the subsequent decline in the cash ratio further underscores tightening liquidity. These patterns highlight the importance of monitoring working capital management and potential impacts on operational flexibility and financial stability.
Current Ratio
IQVIA Holdings Inc., current ratio calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | 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 | |||||||||||||||||||||||||
| AbbVie Inc. | |||||||||||||||||||||||||
| Amgen Inc. | |||||||||||||||||||||||||
| Bristol-Myers Squibb Co. | |||||||||||||||||||||||||
| Danaher Corp. | |||||||||||||||||||||||||
| Eli Lilly & Co. | |||||||||||||||||||||||||
| Gilead Sciences Inc. | |||||||||||||||||||||||||
| Johnson & Johnson | |||||||||||||||||||||||||
| Merck & Co. Inc. | |||||||||||||||||||||||||
| Pfizer Inc. | |||||||||||||||||||||||||
| Regeneron Pharmaceuticals Inc. | |||||||||||||||||||||||||
| Thermo Fisher Scientific Inc. | |||||||||||||||||||||||||
| Vertex Pharmaceuticals Inc. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 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 Q3 2023 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Current Assets
- The current assets demonstrate a generally upward trend from March 2019 to September 2023. Starting at approximately $3,999 million in March 2019, the figure fluctuated slightly in the initial quarters but showed a marked increase through 2020, reaching around $5,090 million by December 2020. Despite some decreases in 2021 and early 2022, current assets remained relatively elevated compared to the pre-2020 period, with values oscillating between $4,700 million and $5,300 million in the most recent quarters. This pattern indicates a strengthening liquidity position over the observed period, with a peak close to $5,329 million in June 2023 followed by a slight decline to $5,208 million by September 2023.
- Current Liabilities
- Current liabilities also increased over the period but at a more accelerated rate compared to current assets, especially from 2021 onward. The liabilities began near $3,502 million in March 2019 and rose to about $4,558 million by the end of 2020. From 2021, these liabilities consistently increased, reaching $6,657 million in June 2023 and slightly declining to $6,589 million by September 2023. The significant growth in current liabilities from 2021 onward suggests a rising short-term financial obligation burden.
- Current Ratio
- The current ratio illustrates a decline in liquidity relative to short-term obligations across the period. Starting above 1.1 in early 2019, the ratio held relatively stable during 2019 and 2020, fluctuating slightly around 1.1. However, a downward trend is evident beginning in 2021, with the current ratio falling below 1.0 from the third quarter of 2021 and continuing to decline to approximately 0.79 by September 2023. This decline below the critical threshold of 1.0 indicates current liabilities surpass current assets, reflecting potential liquidity pressures.
- Summary
- Overall, while current assets increased over the analyzed period, the pace of growth was insufficient to keep up with the accelerated rise in current liabilities, particularly from 2021 forward. This imbalance is reflected in the declining current ratio, indicative of a deteriorating short-term financial position. The fall of the current ratio below 1.0 in recent quarters suggests increased risk related to meeting immediate obligations and highlights a potential area of concern for liquidity management.
Quick Ratio
IQVIA Holdings Inc., quick ratio calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Cash and cash equivalents | |||||||||||||||||||||||||
| Trade accounts receivable and unbilled services, net | |||||||||||||||||||||||||
| Investments in debt, equity and other securities | |||||||||||||||||||||||||
| Total quick assets | |||||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Quick ratio1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| Quick Ratio, Competitors2 | |||||||||||||||||||||||||
| AbbVie Inc. | |||||||||||||||||||||||||
| Amgen Inc. | |||||||||||||||||||||||||
| Bristol-Myers Squibb Co. | |||||||||||||||||||||||||
| Danaher Corp. | |||||||||||||||||||||||||
| Eli Lilly & Co. | |||||||||||||||||||||||||
| Gilead Sciences Inc. | |||||||||||||||||||||||||
| Johnson & Johnson | |||||||||||||||||||||||||
| Merck & Co. Inc. | |||||||||||||||||||||||||
| Pfizer Inc. | |||||||||||||||||||||||||
| Regeneron Pharmaceuticals Inc. | |||||||||||||||||||||||||
| Thermo Fisher Scientific Inc. | |||||||||||||||||||||||||
| Vertex Pharmaceuticals Inc. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 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 Q3 2023 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Analysis of Total Quick Assets
- The total quick assets exhibit a general upward trend from March 31, 2019, through September 30, 2023. Starting at approximately 3,452 million US dollars, these assets generally increased over the periods, peaking around 4,661 million by March 31, 2023, before showing a slight decrease towards the latest date at 4,559 million. This suggests a gradual accumulation of liquid assets and short-term investments, enhancing the company’s liquidity position over time.
- Current Liabilities Trends
- Current liabilities have also shown a consistent increase throughout the examined periods. Beginning near 3,502 million US dollars in early 2019, current liabilities rose steadily, reaching notably higher levels by mid-2023, with values exceeding 6,500 million. This rise in obligations in the short term may indicate increased operational expenses, borrowing, or other short-term financial commitments.
- Quick Ratio Patterns
- The quick ratio, which measures the company’s capacity to meet short-term liabilities with its most liquid assets, demonstrates a declining trend over the period. Starting at a strong nearly 1-to-1 ratio in early 2019, it decreased gradually to around 0.69 by September 30, 2023. This decline signifies a weakening liquidity position, implying that the growth rate of quick assets did not keep pace with the increase in current liabilities. The quick ratio falling below 1 consistently in later periods suggests potential challenges in covering short-term obligations promptly without relying on inventory sales.
- Overall Financial Liquidity Insight
- While the company increased its total quick assets, liabilities grew at a faster rate, resulting in a deteriorating quick ratio. This dynamic indicates a potential tightening in the short-term liquidity cushion. The sustained upward trend in current liabilities warrants attention to ensure that operational cash flows and liquid asset management remain sufficient to meet rising short-term debt levels.
Cash Ratio
IQVIA Holdings Inc., cash ratio calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | 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 | |||||||||||||||||||||||||
| Investments in debt, equity and other securities | |||||||||||||||||||||||||
| Total cash assets | |||||||||||||||||||||||||
| Current liabilities | |||||||||||||||||||||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Cash ratio1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| Cash Ratio, Competitors2 | |||||||||||||||||||||||||
| AbbVie Inc. | |||||||||||||||||||||||||
| Amgen Inc. | |||||||||||||||||||||||||
| Bristol-Myers Squibb Co. | |||||||||||||||||||||||||
| Danaher Corp. | |||||||||||||||||||||||||
| Eli Lilly & Co. | |||||||||||||||||||||||||
| Gilead Sciences Inc. | |||||||||||||||||||||||||
| Johnson & Johnson | |||||||||||||||||||||||||
| Merck & Co. Inc. | |||||||||||||||||||||||||
| Pfizer Inc. | |||||||||||||||||||||||||
| Regeneron Pharmaceuticals Inc. | |||||||||||||||||||||||||
| Thermo Fisher Scientific Inc. | |||||||||||||||||||||||||
| Vertex Pharmaceuticals Inc. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 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 Q3 2023 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total Cash Assets
- The total cash assets exhibited a generally upward trend from early 2019 through the end of 2020, increasing from $991 million to a peak of $1,902 million. This upward movement was especially pronounced in the second half of 2020. However, starting in 2021, a decline is observed, with cash assets falling from $2,402 million at the beginning of the year to $1,477 million by the end of 2021. In 2022 and early 2023, cash assets fluctuated moderately, remaining mostly between $1,300 million and $1,600 million. The most recent data from Q3 2023 shows a modest decrease to $1,332 million.
- Current Liabilities
- Current liabilities steadily increased over the entire period. From $3,502 million in Q1 2019, they rose consistently each quarter, reaching $4,558 million by Q4 2020. This upward trend persisted into 2021 and beyond, with liabilities escalating to $5,241 million by the end of 2021 and continuing to rise throughout 2022 and into 2023. The most recent quarters demonstrate a significant increase, with current liabilities peaking at $6,657 million in Q2 2023 before slightly declining to $6,589 million in Q3 2023. This pattern indicates growing short-term financial obligations over time.
- Cash Ratio
- The cash ratio, measuring liquidity by comparing cash assets to current liabilities, followed a variable trend. Initially, it maintained a relatively stable position around 0.25 to 0.28 through most of 2019. The ratio improved significantly in 2020, climbing from 0.25 in Q1 to a peak of 0.49 in Q1 2021, reflecting the company's increased cash assets relative to its liabilities during that period. After this peak, the ratio declined sharply through 2021 and 2022, fluctuating between 0.20 and 0.30. The decline continued into 2023, reaching its lowest point of 0.20 by Q3 2023. This downward momentum suggests a reduction in short-term liquidity relative to obligations, driven by the rising current liabilities outpacing the cash asset levels.
- Summary
- Overall, the data reveals growing current liabilities over the entire timeframe, indicating an increasing level of short-term obligations. Cash assets increased notably until late 2020 but then decreased and stabilized at a lower range in subsequent years. The cash ratio mirrored these trends, initially improving as cash assets surged but subsequently declining due to escalating liabilities and shrinking cash reserves. This pattern highlights a gradually weakening liquidity position over recent periods, which could suggest heightened financial risk if the trend continues without corrective measures.