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)
Zoetis Inc., liquidity ratios (quarterly data)
Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 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 exhibits notable fluctuations over the observed periods. It began at a high level of 4.05 in March 2019, increasing slightly to 4.39 by September 2019 before experiencing a sharp decline to 2.63 by December 2019. Subsequently, the ratio showed moderate variability, rising again to peaks above 4.5 in the second half of 2021, followed by a decline to the low 2.2 range in mid-2022. More recently, the ratio has stabilized around the mid-3 range from early 2023 through the first quarter of 2024, indicating a generally strong but somewhat variable liquidity position.
- Quick Ratio
- The quick ratio follows a trend broadly similar to the current ratio but at lower values, reflecting the exclusion of inventory from current assets. Initially, the ratio was approximately 2.55 to 2.72 through the first three quarters of 2019, dropping to 1.67 by the end of that year. It rebounded to above 3.0 in late 2021, signifying improved short-term liquidity excluding inventory. However, the ratio declined considerably in 2022, reaching a trough around 1.28. The quick ratio showed a modest recovery in 2023 but remains below earlier peaks, indicating a more conservative liquidity level excluding less liquid assets.
- Cash Ratio
- The cash ratio demonstrates the most conservative measure of liquidity and shows a downward trend over the entire period. Starting at 1.66 in early 2019 and holding relatively steady until the third quarter of 2019, it then dropped notably to near 1.07 by the end of 2019. While it experienced a recovery in 2020 and peaked at 2.23 in late 2021, the ratio declined sharply through 2022, bottoming out near 0.87. Thereafter, the cash ratio stabilized around 1.00 to 1.10 in 2023 and early 2024. This suggests fluctuations in highly liquid asset levels relative to current liabilities, with some tightening of cash reserves in recent years.
- Overall Observations
- Liquidity ratios collectively indicate that the entity’s short-term financial health has experienced periods of volatility with phases of strong liquidity followed by tightening, particularly noticeable in 2019 and again in 2022. The current ratio's larger values compared to quick and cash ratios suggest a significant portion of current assets are composed of inventory or other less liquid assets. The downward trends in quick and cash ratios in 2022 point to reduced liquid asset buffers during that period. The stabilization of ratios around moderate levels in 2023 and 2024 suggests a managed approach to liquidity, balancing asset composition and liability obligations.
Current Ratio
Zoetis Inc., current ratio calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | 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: 2024-03-31), 10-K (reporting date: 2023-12-31), 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 Q1 2024 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Current Assets
- Current assets showed a gradual increase from Q1 2019 through Q4 2019, rising from 4,379 million USD to 4,748 million USD. A notable uptick occurred in the first half of 2020, peaking at 6,757 million USD in Q3 2020, followed by minor fluctuations throughout 2021, generally staying above 6,600 million USD. The values slightly decreased in early 2022, holding around 6,500 to 6,800 million USD. A significant rise took place in Q4 2022 reaching 7,506 million USD, before declining once more in 2023 to values near 6,200 to 6,300 million USD, ultimately stabilizing at 6,359 million USD in Q1 2024.
- Current Liabilities
- Current liabilities were relatively stable around 1,000 to 1,800 million USD during 2019, except for a spike to 1,806 million USD in Q4 2019. This was followed by a progressive increase through 2020, peaking at 2,400 million USD in Q3 2020. Throughout 2021, liabilities exhibited volatility, with a notable drop to 1,471 million USD in Q3 2021 before surging sharply to 3,034 million USD in Q1 2022 and maintaining elevated levels around 2,800 to 3,100 million USD in the first half of 2022. Liabilities then decreased considerably in the latter part of 2022 and remained below 2,000 million USD across 2023 into early 2024, fluctuating between 1,600 and 1,900 million USD.
- Current Ratio
- The current ratio began the period at a strong level above 4.0, indicating high liquidity relative to short-term obligations. In 2019, the ratio declined sharply to 2.63 by Q4, reflecting the rise in current liabilities outpacing assets. The ratio rebounded in mid-2020, fluctuating between 2.77 and 3.47, before peaking notably at 4.54 in Q3 2021. Afterward, a downward trend ensued, diving to about 2.18-2.27 in mid-2022, coinciding with heightened liabilities and somewhat reduced assets. The ratio recovered gradually toward the end of 2022 and stayed above 3.0 during 2023, ending near 3.33 in Q1 2024. This pattern suggests variable but generally sustainable liquidity, with periods of tighter short-term financial flexibility interspersed with stronger liquidity positions.
Quick Ratio
Zoetis Inc., quick ratio calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | 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 | ||||||||||||||||||||||||||||
| Short-term investments | ||||||||||||||||||||||||||||
| Accounts receivable, less allowance for doubtful accounts | ||||||||||||||||||||||||||||
| 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: 2024-03-31), 10-K (reporting date: 2023-12-31), 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 Q1 2024 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total Quick Assets
-
Total quick assets exhibited a generally fluctuating trend over the reported periods. The values showed moderate growth from approximately 2,763 million USD in the first quarter of 2019 to a peak around 4,796 million USD in the last quarter of 2022. However, post this peak, there was a notable decline to roughly 3,011 million USD by the third quarter of 2023, with a modest recovery observed in early 2024 at about 3,268 million USD.
- Current Liabilities
-
Current liabilities increased markedly over time, starting at approximately 1,082 million USD in the first quarter of 2019 and rising to a high point near 3,167 million USD in the last quarter of 2022. Following this peak, a significant decrease was noted throughout 2023, stabilizing around 1,909 million USD by the first quarter of 2024.
- Quick Ratio
-
The quick ratio demonstrated considerable variability across the quarters. It began at a strong level above 2.5 in early 2019, but declined sharply to near 1.67 by the end of 2019. Recovery was noted in 2020 and 2021, reaching a high of about 3.01 in the third quarter of 2021. However, from that point onward, the ratio trended downward to its lowest values around 1.28 in late 2022. Modest improvement occurred in 2023, with the ratio fluctuating between 1.7 and 1.9, ending near 1.71 in early 2024.
- Overall Insights
-
The data indicates periods of increased liquidity followed by contractions. The surge in total quick assets between mid-2020 and late 2022 was paired with a steep rise in current liabilities, suggesting increased short-term obligations during this period. The quick ratio's volatility reflects these dynamics, with peaks coinciding with stronger liquidity positions and declines signaling tighter short-term financial conditions. The most recent periods point to a normalization or stabilization of the balance between quick assets and current liabilities, but at levels below the early years of the dataset.
Cash Ratio
Zoetis Inc., cash ratio calculation (quarterly data)
| Mar 31, 2024 | Dec 31, 2023 | 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 | ||||||||||||||||||||||||||||
| Short-term investments | ||||||||||||||||||||||||||||
| 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: 2024-03-31), 10-K (reporting date: 2023-12-31), 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 Q1 2024 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total cash assets
- The total cash assets demonstrate a general upward trend from March 2019 through December 2020, increasing from $1,793 million to $3,604 million. This peak is followed by fluctuations, with a notable decline between March 2022 and September 2022, dropping from $3,135 million to $2,507 million. A significant recovery occurs by December 2022, reaching $3,581 million. However, from March 2023 onward, the asset values again exhibit a downward movement, falling to $1,975 million by March 2024. Overall, the data indicate periods of both growth and contraction in liquidity reserves over the timeline.
- Current liabilities
- Current liabilities show variability, with a rise from $1,082 million in March 2019 to a peak of $3,167 million by December 2022. The liabilities increase sharply around late 2019 and early 2020, and after peaking in late 2022, there is a decline through March 2024, ending at $1,909 million. The pattern suggests cycles of increased obligations possibly corresponding with business expansion or other operational needs, followed by reductions that may stem from liability management or repayment activities.
- Cash ratio
- The cash ratio moves inversely with current liabilities in certain periods. Beginning with a strong level around 1.66 to 1.75 in 2019 and 2020, the ratio experiences a decline beginning in early 2022, dropping below 1.0 from March through September 2022, indicating reduced short-term liquidity relative to liabilities. This ratio recovers somewhat by December 2022 to 1.13 but then mildly fluctuates around 1.0 through March 2024, suggesting a tighter liquidity position with limited buffer against current liabilities in recent periods.