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)
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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
- Current Ratio
- The current ratio demonstrates a general declining trend over the observed periods. Initially, the ratio was above 1.1 from March 2018 until the end of 2020, indicating a relatively stable ability to cover current liabilities with current assets. From early 2021, the ratio showed a noticeable decrease, falling below 1.0 starting in September 2021 and continuing this downward trajectory through September 2023, reaching a low of 0.79. This decline suggests a weakening short-term liquidity position and potentially increased difficulty in meeting short-term obligations.
- Quick Ratio
- The quick ratio follows a similar downward trend to the current ratio, trending below 1.0 throughout the entire period. It started close to 1.0 in early 2018 but experienced fluctuations, generally decreasing from mid-2021 onward. By September 2023, it had declined further to 0.69, indicating a reduced proportion of liquid assets (excluding inventories) relative to current liabilities. This trend points to a tightening liquidity condition, which may affect the company's ability to quickly cover short-term liabilities without relying on inventory sales.
- Cash Ratio
- The cash ratio shows more variability during the time frame. Starting at 0.31 in March 2018, the ratio remained relatively low but saw a peak around the first quarter of 2021, reaching 0.49. However, after this peak, the ratio declined steadily, reaching 0.20 by September 2023. This decline reflects a significant reduction in the company's most liquid assets (cash and cash equivalents) relative to current liabilities, indicating reduced immediate liquidity.
- Overall Insights
- Collectively, the liquidity ratios reveal a weakening trend over the five-year period. The company's ability to meet its short-term obligations with available current assets, particularly cash and liquid assets, has diminished. The current and quick ratios falling below 1.0 indicate potential liquidity pressures, while the declining cash ratio highlights shrinking cash reserves relative to liabilities. These trends may warrant further investigation into working capital management and cash flow operations to ensure the company maintains adequate liquidity.
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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2023 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Current Assets
- The current assets show a general upward trend from March 2018 through the end of 2023, increasing from 3,724 million USD to a peak of 5,579 million USD in March 2021. After this peak, the values fluctuate slightly but remain around the 4,500 to 5,300 million USD range through to the third quarter of 2023. This indicates an overall growth in liquid or short-term assets over the observed period, with some volatility in recent quarters.
- Current Liabilities
- Current liabilities also demonstrate an increasing trend across the same timeframe, rising from 3,199 million USD in March 2018 to 4,868 million USD by March 2021. Following this period, current liabilities continue to rise more significantly, reaching 6,657 million USD in March 2023, before slightly declining but remaining elevated near 6,500 million USD towards the third quarter of 2023. This indicates growing short-term obligations, especially noticeable from 2021 onward.
- Current Ratio
- The current ratio remains slightly above 1.0 from 2018 through early 2021, fluctuating generally between 1.05 and 1.16, which suggests that the company had a modest buffer of current assets over current liabilities during this period. Starting from the second quarter of 2021, the current ratio begins to decline steadily, falling below 1.0 from September 2021 onwards and reaching a low of approximately 0.79 by September 2023. This decline reflects a shift where current liabilities increasingly outpace current assets, indicating a potential decrease in short-term liquidity or increased reliance on current liabilities to support operations.
- Overall Insights
- Over the analyzed period, both current assets and current liabilities increased, with liabilities growing at a faster rate, especially after early 2021. While the company initially maintained a comfortable current ratio above 1, recent quarters demonstrate a weakening liquidity position with the current ratio dropping below 1. This trend suggests increased pressure on the company’s capacity to cover short-term obligations with short-term assets, which may warrant closer monitoring of working capital management and liquidity risk going forward.
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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2023 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Trends in Total Quick Assets
- The total quick assets showed an overall upward trajectory from March 2018 through September 2023, starting at approximately $3.26 billion and reaching around $4.56 billion. Notable increases occurred in the period between June 2020 and March 2021, with a peak at $4.76 billion in March 2021. After this peak, a decline is observed until September 2021, followed by a recovery and relatively stable levels around the $4.0-$4.6 billion range through the end of the series.
- Current Liabilities Evolution
- Current liabilities experienced a consistent rise over the reported periods, increasing from about $3.20 billion in March 2018 to $6.59 billion by September 2023. This reflects a doubling over the span of nearly six years. The growth in current liabilities is steady, with more pronounced increases occurring from late 2021 onwards, peaking at $6.66 billion in March 2023 before stabilizing slightly below that level.
- Analysis of Quick Ratio
- The quick ratio indicates a gradual decline in liquidity over the observed periods. Starting above 1.0 at 1.02 in March 2018, it dipped below 1.0 by June 2018 and mostly hovered between 0.94 and 0.96 through 2020. From 2021 onward, the quick ratio exhibited a sharper downtrend, falling from 0.98 in March 2021 to around 0.69 by September 2023. This signals a weakening ability to cover current liabilities with liquid assets on a short-term basis.
- Overall Financial Condition Insights
- The data indicates growth in quick assets but at a slower pace compared to the growth in current liabilities, which has led to a falling quick ratio. The company's short-term liquidity position appears to weaken over time, especially from 2021 onward, suggesting increased pressure on liquid resources relative to obligations. This trend could warrant closer monitoring of working capital management and potential impacts on financial flexibility.
Cash Ratio
IQVIA Holdings Inc., cash ratio calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31).
1 Q3 2023 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total Cash Assets
-
Total cash assets demonstrated a fluctuating trend over the periods analyzed. From March 31, 2018, to December 31, 2018, cash assets experienced a modest decline, moving from $1,007 million to $938 million. The first half of 2019 saw relative stability with values just under $1,000 million, before a mild decline towards the end of that year.
Starting in March 31, 2020, there was a notable upward trend, with cash assets increasing significantly across 2020, reaching a peak of $1,902 million by December 31, 2020. The peak continued into the first quarter of 2021, climbing further to $2,402 million.
Subsequently, cash assets decreased considerably during the remainder of 2021 and into 2022, with amounts stabilizing around $1,300 to $1,500 million. The first three quarters of 2023 showed a small decreasing trend again, with values falling from $1,598 million to $1,332 million.
- Current Liabilities
-
Current liabilities displayed a general upward trajectory throughout the entire period. Beginning at $3,199 million in March 2018, liabilities increased gradually, with slight accelerations in growth observed near the end of 2019 reaching $3,945 million and then continuing to $4,558 million by December 2020.
The trend intensified through 2021 and 2022, peaking at $5,578 million by March 31, 2023. The liabilities maintained a high level, slightly decreasing in the subsequent quarters but remaining above $6,500 million by late 2023. This indicates increasing short-term obligations correlating with the company’s expanded operations or financing activities.
- Cash Ratio
-
The cash ratio, representing liquidity by comparing cash assets to current liabilities, showed a declining trajectory overall. Initially, the ratio was approximately 0.31 in March 2018, dipping to as low as 0.23 by December 2019, highlighting a decreasing liquidity position relative to short-term liabilities during this period.
There was a temporary improvement in 2020, with the cash ratio rising to a peak of 0.49 in March 2021, corresponding with the peak in cash assets. However, from mid-2021 onwards, the ratio declined steadily, reaching 0.20 by September 2023, suggesting a growing imbalance between cash reserves and current liabilities.
This downward trend in cash ratio, coupled with increasing current liabilities, reflects a deterioration in immediate liquidity coverage and could imply higher short-term financial risk or reliance on less liquid assets or financing.